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In a sense I think the yields on stable coins are a reflection onto the user of value which would otherwise be captured by the banking industry. There are some
by pcthrowaway 5y ago
In a sense I think the yields on stable coins are a reflection onto the user of value which would otherwise be captured by the banking industry. There are some assurances lost at the same time, and most would consider stablecoins less safe than a bank, but these are tradeoffs one makes when using stablecoins.
- ptero 5y agoI am not sure of this (or maybe I misunderstood your point, sorry). Instead of retail clients, which could get a raw deal from the bank, we can look at inter-bank rates for a sanity check. And those rates, paid to non-retail customers (who know well how to derive a maximum risk-adjusted value) are still very, very low today. US Treasuries yield curve shows pay 0.3% for a 1-year and 1.5% for a 10-year. While it is certainly harder for a company to get rates as low as US Gov't, solid businesses can get money for 2-3% and weak ones for 5-8% in as large a chunk as they want. Why would they spend a lot of effort chasing retail clients (which are a pain to deal with) and offering them way more?