Will Stablecoins help transform cryptocurrencies from early adopter to mainstream stable in trans-border transactions?

Colleagues, price volatility has been the Achilles heel of cryptocurrencies in 2018 and a major impediment to their mass market adoption … particularly among institutional investors. Enter Stablecoins (SCs). Unlike pure play cryptos which are essentially fiat digital assets, Stablencoins are pegged to an underlying asset – gold, silver, crude oil or sovereign bank currencies such as the US dollar and Japanese yen. Stability is the key driver behind the launch of a wave of Stablecoins including an Australian dollar-pegged SC, Gemini US dollar pegged SC, GMO’s planned yen-pegged SC which is scheduled to come to market in early 2019. All of these developments lead to the obvious question: If SCs are pegged to an underlying asset why not simply invest directly in the asset (e.g. oil futures) itself? Let us offer a two-fold answer: First, investors in SCs are legally entitled to the underlying assets if a problem occurs with the digital asset. Second, SCs offer big benefits to the remittance market. Remittances are trans-border transactions made by people who work overseas who send their wages to their families in their country of origin. In turn, SCs, like regular cryptocurrencies are Blockchain-based which increase the speed of transactions and lower costs. Bottom line: The Cryptocurrency Academy believes Stablecoins appear to have a viable real world use case, yet will in no way undermine or limit the adoption of cryptos such as Bitcoin, Ethereum and Litecoin. Post your comments today! Lawrence – Cryptocurrency Academy (https://cryptocurrencyacademy.blogspot.com/)