RE: USDD is Justin Sun’s exit scam for TRON
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The 20% interest isnt absurd at all. Look at the number of HBD available. How many do you think will be required to be a legitimate stablecoin?
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You would need way more than 10% or even 30% of the market value of HIVE. But even if the market value of HBD was at 30% of HIVE. It really wouldn't matter until people started using the coin as currency.
The Better Answer
But I will give a better answer to your question.
Stablecoin just means "pegged currency."
The HBD conversion formula is sufficient to create a stablecoin. People can hold as much HBD as they need for their local transactions.
If the witnesses realized that the formula was more important than the number of HBD in existence; then HIVE could do something truly amazing.
HIVE could create "stablecoins" for all of the major currencies. The system could allow users to choice the stablecoin of their choice. People in the EU might choose the Euro, people in Nigeria could use the Naira. People in Venezuela could choose the bolívar.
You might even be able to create stablecoins for silver and gold.
The system simply needs to use a reputable source for prices. The system could use the same three day formula for conversions.
Having a large number of HBD in existence only creates an existential threat to HIVE. A better approach would be to do something cool like creating a conversion process for different currencies.
ok. maybe, i'm missing it but what do does making a whole bunch of new pegged coins do? aren't all major world currency essentially dollar backed coins now?
if you are trying to spread out risk then having a smaller circulation for each currency seems more manipulatable.
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Central banks often hold US dollars, but the current thinking is that it is best to let the currencies float against each other in open exchanges.
This is why there is an active Forex market.
Attempts to peg currencies have failed. The most famous failure came in 1979 when England was trying to maintain a peg between the pound and deutsche mark.
A piece of human filth named George Soros formed a cartel to short the pound. His group took a 3.3 billion short on the pound which broke the bank of England. George Soros made 3 billion in a single trade. He has used the money to advance far left causes ever since.
Central banks realized that attempts to peg currencies would open countries to economic sabotage and now let their currencies float.
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If HIVE depended on the formula alone with rates from reputable Forex exchanges; then there really wouldn't be any risk.
Remember, the risk comes from the number of coins that people are holding. Prior to the 20% interest, the market cap of HBD was less than a percent of HIVE. One could assume that the same would hold true of the Euro version of HBD.
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