Could Stablecoins Be The Answer to Cryptocurrency Woes? 4 1169

You might be curious about investing in crypto. You maybe even made a few bucks (or lost some, depending on your timing). But the infamous volatility in cryptocurrency value makes it almost unviable as an actual method of paying for goods and services. After all, you may dabble in digital money in an exchange, but would you be willing to accept your wages in Bitcoin? That’s where stablecoins are a game changer.

When FUD washes through the sensitive markets, digital coins like Bitcoin and Ethereum are highly unreliable. You could make a significant increase one day, but you could also take home half pay the next. Maybe that’s not a problem when it comes to purchasing a coffee or a FMCG, but when you’re buying high ticket items or receiving a regular salary, volatile cryptos are not the answer.

Enter Stablecoins

In an attempt to establish a commonly agreed upon worth, stablecoins are growing in popularity. Stablecoins are cryptocurrencies that are pegged to another stable asset. This includes the US dollar, gold, and even silver. That makes for low volatility, without tying it to any central bank and allows for more practical, everyday usage.

Stablecoins are causing a lot of excitement in the crypto world as they could be the catalyst for widespread adoption of digital money. The fact that they are still decentralized means that transaction fees are low or non-existent, and they offer a certain degree of privacy as well. But obviously the main advantage to stablecoins, as the name suggests, is their stability.

Stablecoins provide a viable altcoin that can be used in everyday transactions and for long term payment schemes as well.

So, the question now may be not whether stablecoins will take off, but who will be the first to do it successfully? There are already a few on the market, but they each have their advantages and drawbacks.

Tether

Tether is pegged to the US dollar and claims to be 100 percent backed by fiat currency. For every digital tether coin, there is a tangible dollar behind it. 1 tether USTD equals $1 USD. Simple. But not without its issues.

While its stable value is widely recognized, tether could be a ticking bomb, as its trading volume regularly exceeds its market cap. And more than one authority is beginning to question its claims. Its centralization goes against the cryptocurrency philosophy, as well.

MakerDao

Unlike Tether, Maker is decentralized. Like Tether, it is also pegged to the US dollar, but it’s backed by ETH as well. Their stable coins are called Dai and each one is worth $1 USD. The price stability is achieved through an autonomous system of smart contracts.

Being backed by ETH means that Dai is on the blockchain and therefore transparent. But the process of purchasing Dai is a little complex. Its entire system is hard to get to grips with and probably not user friendly enough to become mainstream.

NuBits

Don’t let the name put you off. NuBits has been successfully trading for a few years already, as one of the first stablecoins to emerge. When it first came out, cryptocurrency was not as volatile, and many people questioned the point of a digital currency that could not be used for investment purposes. But NuBits has proven its worth. The only market their USNBT coin lost value to was Bitcoin, which is hardly surprising considering the latter’s meteoric rise.

NuBits offers a good option for those looking for almost zero volatility. It’s also cheap to spend, as there are no vendor fees, which means it’s more attractive than using a credit card. And there are also no chargebacks for vendors, as all transactions are irreversible.

If cryptocurrencies will ever go mainstream or even replace fiat currency completely, they will need to be price stable. While Bitcoin and Ether continue to rise and fall, stablecoins could be on the up and up.

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Christina is a technology and business communicator who has worked with high profile ICOs and blockchain influencers to break industry news.

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The Bitcoin Bull Run: How It Started, How It’s Going Comments Off on The Bitcoin Bull Run: How It Started, How It’s Going 137

Wherever you stand on Bitcoin, there is no question about its impact on the role of blockchain and cryptocurrency within society.  Whether we look back to Pizza Day or to its heights in 2018, the volatile nature of the cryptocurrency has garnered much speculation and media coverage. 

While many looked at the past few years as a “Crypto Winter,” others saw an opportunity for Bitcoin.  Between COVID lockdowns, political, and fiat currency concerns, Bitcoin has been on a dream run – for a moment going over the $55,000 barrier.

Why Did Bitcoin Suddenly Explode (Again)?

Elon Musk and other influencers played a role in the recent rise in Bitcoin’s price. Tesla’s recent investment in an infrastructure to accept Bitcoin payments, and Apple Pay’s introduction of BitPay, a prepaid bitcoin MasterCard, are also major markers of market adoption. But two other events occurred that set the stage for the Bitcoin bull run: a pandemic and Bitcoin Halving.

Every four years, Bitcoin miners have their processing transactions cut in half. This reduction in supply then drives up prices based on scarcity. This occured in May 2020, when the economy was already at a standstill due to the pandemic. Since the supply of crypto coins is finite many think that there is lower inflation risk with using them – this means that it may be used as a hedge against U.S. inflation. In 2020, more than 20% of all dollars currently in circulation were printed, making crypto even more alluring. 

Crypto isn’t going anywhere. This year, experts project increased use of crypto cards, emergence of new cases, and increased investing from traditional finance leaders.

Take a look at this visual deep dive on the rise of Bitcoin for more information:

Bitcoin: Once A Diamond In The Rough, Now A Treasure

Happy 10th Birthday, Bitcoin!! 7 114

On January 3rd, 2009, block number zero produced the first 50 bitcoins. They were mined by none other than the mysterious Satoshi Nakamoto. Thus was born the phenomenon of the decade. And on January 8th, ten years ago today, bitcoin became a public network when Nakamoto released bitcoin version 0.1.

Nakamoto announced the release via the Metzdowd cryptography mailing list, calling bitcoin “a new electronic cash system that uses a peer-to-peer network to prevent double-spending.”

Nakamoto’s description of the software that would revolutionize technology is sparing and to the point. “It’s completely decentralized with no server or central authority,” the succinct announcement goes on. “Windows only for now.  Open source C++ code is included.” It describes the proof of work as “ridiculously easy”.

It follows with a brief description of how transactions work, how many coins will be released and how they can expect to split every 4 years, along with the caveats that the software was still “alpha and experimental,” offering “no guarantees”. It’s signed with no letter closing, simply:

“Satoshi Nakamoto”

Bitcoin, This Is Your Life

My what a ten years it has been. Just to recap:

On January 12th, 2009, programmer Hal Finney, who had downloaded the new bitcoin software immediately, received ten bitcoins from Nakamoto. This was the first ever bitcoin transaction. Over a year later in May 2010, programmer Laszlo Hanyecz received 10,000 bitcoins in exchange for two Papa John’s pizzas, initiating the first real-world bitcoin purchase and thereby creating the pizza index.

Bitcoin simmered until 2017, when it’s value jolted from $900 to over $19,000, and bitcoin became a household name. Over the past year, the original crypto has settled to a more modest $4,000 valuation, and stirred up a lot of public din in its wake.

Where Were You on January 9th, 2009?

So where were you on the day of Nakamoto’s announcement? Probably on your couch watching DVDs of Pineapple Express and It’s Always Sunny in Philadelphia seasons 1 through 3, or laughing at Dr. Horrible’s Singalong Blog on your iPhone 2.

It was a simpler time. Wired was calling Google Earth the number one app on the fancy new iPhone app store. Competition was fierce with Windows 7 in beta. Facebook had recently dropped the “is” from status updates, and a fun app called Twitter (formerly “Twttr”) had just introduced a feature called Trending Topics.

Trending Topics

David Bowie was celebrating one of his eight final birthdays, while Michael Jackson and Patrick Swayze were enjoying their last few months among us mortals. Only days later, pilots Chesley Sullenberger and Jeffrey Skiles made aviation history by skillfully crash landing US Airways Flight 1549 in the Hudson River, saving everyone on board.

A burgeoning class of ennui soaked fashionistas, deemed “hipsters,” were described in Time Magazine as “smug, full of contradictions and, ultimately, the dead end of Western civilization,” a vermin who “manage to attract a loathing unique in its intensity.” They went on with this colorful character sketch:

“Hipsters are the friends who sneer when you cop to liking Coldplay. They’re the people who wear t-shirts silk-screened with quotes from movies you’ve never heard of and the only ones in America who still think Pabst Blue Ribbon is a good beer. They sport cowboy hats and berets and think Kanye West stole their sunglasses. Everything about them is exactingly constructed to give off the vibe that they just don’t care.”

Time Magazine, 2009

Is it time for any of that to come back into style yet? Maybe give it a few more years. We need a break.

Williamsburg was gentrifying and Portland was still America’s best kept secret. The streets were flooded with fixed gear bikes and the sounds of Grizzly Bear, Real Estate, Kings of Convenience, and TV on the Radio.

Animal Collective’s Merriweather Post Pavilion was just a few days old, and Fever Ray’s self titled was about to drop. The world was listening to Lady Gaga, whose single “Just Dance” hit number one on Billboard’s top 100, and Taylor Swift’s Fearless, which was the top selling album.

That same month, box offices favored the cuddly Marley & Me, while The Dark Knight swept the people’s choice awards. Audiences were still getting wowed by Avatar, paying a lot to be disappointed by Mall Cop, and getting hyped about the upcoming Watchmen movie.

Meanwhile in Washington DC, a president with a multisyllabic vocabulary was about to be inaugurated (a rarity in the 21st century, we would find out), and his kids were playing with a Wii they got for Christmas.

Here’s To Another Decade Ahead

What a time it was, the dawn of 2009. And most of us, at least for a few more years, had never heard about blockchain, cryptocurrencies, or bitcoin.

And now here we are.

So, dear reader, here’s to ten more years of crashes, booms, bubble scares, hype, derision, libertarian fanboys, pizza and moon lambos. Happy tenth birthday, bitcoin!!1

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