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Comment by intotheabyss | Hacker News Reader

It means that ETH which is a decentralized cryptocurrency can be used as a collateral for an algorithmic stablecoin called RAI that adjusts its price based on the price of ETH from a Uniswap price feed and a PID controller and arbitrage. To mint RAI you need to deposit ETH. The goal of RAI is to create a stablecoin which dampens the price movements of ETH over long periods of time.

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Are you talking about the RAI that traded at $0.0186 a few days ago and that you can now sell for $0.00022 ? That's a "stablecoin"?

https://atomars.com/trading/RAIUSDT

No, that's not the RAI I'm talking about. This is https://www.coingecko.com/en/coins/rai

The fact the community felt the need to invent a "stablecoin" isn't terribly reassuring

Why not? Its a new asset, what is wrong with improvement? I mean using that logic does it also disturb you that somebody invented the seat belt? Would you prefer they didnt invent seat belts? Would that have been more reassuring of the relative safety of the vehicle if they never admitted that you could die in a car crash? The point of stable coins is really only apparent if you're trading crypto just like the importance of seat belts might make more sense to somebody that drives daily.

On the contrary, decentralized stablecoins are some of the most exciting things in the space. The MakerDAO system, which issues the DAI stablecoin, is earning 2.5 million every year, distributed to token holders. It has survived multiple market crashes. Algorithmic stablecoins attempt the same thing w/o collateral, and seem to have done well in this drawdown as well.

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