Exactly. Stablecoins are a misnomer. They’re stable until they’re not, then they implode.
Meanwhile, Tether regularly (every couple of weeks) drops to 98-cents or less. Celsius, Gemini, and FTX all imploded with 100% losses (at least, my friend's "stablecoins" in those accounts were completely lost and no one has given his money back yet)
There is an alarming frequency at which stablecoins break the buck. I'm pointing out imperfect dollar instruments like Money Market Funds that have no insurance and are free to invest into riskier bonds... but even these risky MMFs are far more stable in practice than USDC or Tether, or any other stablecoin for that matter.
The issue is that Stablecoins suck in general, and that cryptocoins in general are filled with Conmen who will misuse your money. And none of the cryptocoin community has _any_ form of defense (legal, or otherwise) that determines who is, or isn't, trustworthy. Because the cryptocoin community is too religious about believing that cryptocoins are innately trustless or something.
Make a stablecoin without any banking like Lunacoin, and you'll collapse. Make a stablecoin like USDC connected to banks, and you'll earn less than the FFR / Money Market funds. Lie about it all like Gemini and you lose your shirt (lol 18%+ APY returns. An obvious lie, to me at least. But my friends didn't believe me).
The naked cronyism, conmen, and assholes have ruined the cryptocoin experiment in every way possible. DeFi, CeFi, whatever. Its all just excuses, I'm fairly certain that I can list off a failure that matches whatever methodology you wish to bring up.
2. The US has been the economic leader of the world for those hundred years, so of course nobody is losing money under the FDIC. But no guarantees on how long that will last
We're on track to people losing 100% of their stablecoins at some crappy fake online bank every 4 or 5 _months_.
Celsius, Gemini, FTX. Who is next? Your money was safer in Argentina than in FTX or LunaCoin.
Similar mechanism exists globally. Have a read:
https://www.narrowbanking.org/
Caveat - the main problem with DeFi is that Solidity and the EVM are garbage and give programmers too many footguns to accidentally shoot themselves with. Most DeFi failures have been a result of those languages being based on Javascript (wtf!) and prioritizing familiarity and ease of use over security, correctness, and provability. But there are other more solid platforms for DeFi, and better and better tooling for EVM-based DeFi.