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Comment by AdamN | Hacker News Reader

What's so weird about these stable coins is that there's no money to be made with them (for the end user). They're 'stable' so have no upside but they're non-redeemable when things aren't working and have a real probability of going straight to zero at any given moment.

I'd get it for some volatile coin where the risk is potentially worth it but holding these for more than a few days for clearing (?) doesn't make sense to me.

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If you follow the money it makes perfect sense. After all, after converting to your 'internal stable coin' you can claim you have the reserves and you're free to spend the original coins in the real world. Right up to the moment that everybody wants their money back and it turns out that your stable coin was worthless.

Why do people hold cash instead of having all of their money invested? Stablility is a feature. People want a stable store of value that is on chain.

Problem lies here that dodgy institutions without goverment supervision are issuing stable coins so you never know when some crypto guy is going to do rug pull. But first government backed stable coin which you can buy and sell fast will be huge.

As if government institutions are any more dutiful. The British banknotes still say “I promise to pay the bearer on demand…” as a big FU to all the holders.

...signed by the Governor of the Bank Of England, the oldest central bank in the world, which has never yet reneged on that promise to exchange paper for hard currency.

I see your point, but also: that pound was a failed stablecoin against the Deutschemark at one time.

http://news.bbc.co.uk/onthisday/hi/dates/stories/september/1...

> a failed stablecoin against the Deutschemark

That's an interesting way of spinning the pound falling out of the ERM (which wasn't the same as the Deutschmark). From the perspective here, getting out of the ERM was a blessing, not a "failure".

And at no point did a paper pound cease to be exchangeable with hard currency. So I stand by my earlier remark.

Not sure if that’s sarcasm, but the promise is to exchange it for gold, not “hard currency”. Barely 100 years since the establishment of the Bank of England has passed before the convertibility was annulled for 20 years because of wars and, as a consequence, gold shortage.

There's no mention of "gold". It says on this here piece of paper: "I promise to pay the bearer on demand the sum of twenty pounds".

The implication that this £20 note is not actually £20. But ten £2 coins is coin-of-the-realm, and coin is what you can expect the Governor to hand over when you go to cash-in the promise.

The government institutions are definitely more dutiful than Binance. Even if they weren't though, a USD will have more value after a major Fed screw up than the equivalent stablecoin after their crypto backers make a major screw up.

Quite a few people want to borrow stable coins and are prepared to do so at interest.

Yes, to short them.

And the shell game continues ;)

Sure, but the point is that

> What's so weird about these stable coins is that there's no money to be made with them (for the end user).

Doesn't tell the whole story - it is possible to seek returns from owning stable coins.

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