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Comment by wslh | Hacker News Reader

> Actually, the worst case is a crash and the whole scene collapsing in a mess of criminal trials and bitter recriminations.

As I said in my comment and my post[4]: [even if they crash] stable coins are one of the major drivers of cryptocurrencies/blockchains and by definition fully collateralized stable coins does not crash or if they crash it is because the underlying standard financial system crashes.

I also highlight that in this context the most interesting thing about blockchains is that "Openness and interoperability have become more important than decentralization".

[4] The Rise of Stable Coins: Beyond Facebook Libra: https://www.linkedin.com/pulse/rise-stable-coins-beyond-face...

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> fully collateralized stable coins

Which ones are those?

The biggest (Tether) have admitted that they are not fully collateralised and withrawn their claims to such. In a court filing last year they announced they had around 73% of the funds available in 'cash or cash-like instruments', but even that hasn't really been verified, nor is it apparent whether "cash-like instruments" includes other cryptocurrencies.

USDC for example.

Oh, and

>I also highlight that in this context the most interesting thing about blockchains is that "Openness and interoperability have become more important than decentralization".

The most interesting thing to me about "blockchains" is how the hype train is still limping on, after almost zero actual delivery of anything useful or world-changing. I expect it to continue to lose steam, as all the pupported use-cases turn out (as they all have so far) either to be some sort of impractical techno-utopian dream, an unnecessary complication where a database works just fine (better in fact), or an outright scam.

I am sharing your sentiment but not 100%. My point there was different, and I highlighted that was an irony: now we have a way to interoperate with less friction than banks or other financial institutions thanks to a new infrastructure. This infrastructure could not be a blockchain and can be a better technology based more in typical federations and less on BFT like descentralization.

Why exactly shall I hold my USD funds in USDC instead of just, you know, US Dollars?

That just doesn't make any damn sense, whatsoever.

For example, USD 10,000 is the absolute maximum you can bring into or take out of the US, or move between accounts in the US, without intrusive and possibly annoying declarations of source of funds, and potential exposure to instant civil forfeiture if you are deemed suspicious [0].

Stablecoins may not be practically subject to these restrictions (they may have other very serious risks and limitations, but not the same ones as USD).

So choose whatever currency is best for you. Isn't it nice to have a choice?

[0]https://news.ycombinator.com/item?id=22489103

> Stablecoins may not be practically subject to these restrictions

Presumably they are subject to these restrictions in law, it's just that right now they fly under the radar.

So ... you're advising people that stablecoins are a good way to break the law?

They may make certain unjust laws, such as arbitrary civil forfeiture, impossible to enforce.

So ... you're in favor of innocent people having their money confiscated on the spot without due process?

No, but I'm quite fond of the proceeds of crime being recovered, so I don't think making such things impossible to enforce is a positive, no.

So regulatory arbitrage? I don’t think law enforcement will see things that way.

OP asked for any reason to hold funds in USDC instead of USD, because they firmly believed there was no reason. I suggested one reason.

Your imagination beyond that is up to you.

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