5 ms·

Crypto prices are tanking with this news but DeFi and the blockchain is doing fine. Uniswap and Aave still processing user funds securely.

6d6b73 4y ago
We'll talk in a few weeks ok?
- rideontime 4y ago
  The price can go to zero and people like this will still boast about the blockchain continuing to function. They're two different discussion topics: does the technology work, and is it actually worth anything?
  - zeroclip 4y ago
    The price can go very low and stable coins and DeFi protocols around those can still function exactly as they ever have. A well regulated stable coin will function like any other financial service the West is used to.
    - dragontamer 4y ago
      A money market fund is federally regulated to be 30% liquid per week. Because of this, it is very difficult to build a MMF that has much better returns than your competitors. In particular, most MMFs are in-and-around 3.6% APY returns. These crypto-coins are promising 6%, 10%, 18%, or 20% returns APY. Spoiler alert: they aren't being run like a well regulated MMF. -------- BTW, a money market fund is a mutual fund with regulations such that 1 share in the MMF is equal to $1. They are the already legal stablecoins you've been looking for. We can look at the performance of say, VMFXX, which has been $1.00000000 per share for the last 3 or 4 decades. Meanwhile, even the biggest Tether stablecoins floats to $0.998 or $1.001 regularly. Certainly doesn't show very much confidence in the scheme. This 6% staking or whatever, it's not stable. Never has been, never will be. You can't offer a better rate than the risk free rate unless you are willing to take on risk.
      - zeroclip 4y ago
        USDC does not offer yield, but it is still useful. Ethereum staking is actually a sustainable yield as long as there remains demand for block space.
        dragontamer 4y ago
        No one just sits on USDC dude. They get it so that they can stake it on BlockFi at 7% or whatever. https://images.ctfassets.net/s9sj79zoigw1/4TEIhHwGu5G59I3oIxAaKU/d48aca400ce226ffdadd14ace2d8f5a3/Stablecoins__USDC__GUSD__PAX__BUSD__US.png https://images.ctfassets.net/s9sj79zoigw1/4TEIhHwGu5G59I3oIx... If you just turn USD into USDC, you end up losing money, because savings accounts are at 3% these days (https://www.capitalone.com/bank/savings-accounts/online-performance-savings-account/ https://www.capitalone.com/bank/savings-accounts/online-perf...). -------- People who want 1 fund == $1 get savings accounts and/or money market funds (depending on their risk tolerance. Savings Accounts are safer but earn less. MMFs have fewer regulations and can therefore offer slightly better rates but for that extra risk). Anyone promising 7% returns is lying to you. That's far above what even the "riskier" MMFs offer. ----------- Anyway, USDC is just a really weird bond market, where you end up offering loans (which are called "stakes" for some reason) to shady companies at far below market rates (ex: CCC Debt was 10% APY to 16% APY if you bought it on the open market. But if its "Staking" with BlockFi, it only earns 7%). Instead of thinking if these companies would return their money back, people handed money over-and-over to these other companies and wondered why it didn't come back. If you really want to lend money to shady companies, I suggest finding rated bonds (even junk bonds) and playing with that instead.
        zeroclip 4y ago
        > No one just sits on USDC dude Plenty do, and plenty just use it as a stable coin instead of chasing yield. > because savings accounts are at 3% these days Not everybody lives in the USA or want to do this.
    - rideontime 4y ago
      Ok? But once the yield disappears there'll be no reason to use defi.
- zeroclip 4y ago
  What exactly is going to happen? You can’t hide a multibillion $ black hole of debt in Uniswap.

6d6b73 4y ago

We'll talk in a few weeks ok?

rideontime 4y ago
The price can go to zero and people like this will still boast about the blockchain continuing to function. They're two different discussion topics: does the technology work, and is it actually worth anything?
- zeroclip 4y ago
  The price can go very low and stable coins and DeFi protocols around those can still function exactly as they ever have. A well regulated stable coin will function like any other financial service the West is used to.
  - dragontamer 4y ago
    A money market fund is federally regulated to be 30% liquid per week. Because of this, it is very difficult to build a MMF that has much better returns than your competitors. In particular, most MMFs are in-and-around 3.6% APY returns. These crypto-coins are promising 6%, 10%, 18%, or 20% returns APY. Spoiler alert: they aren't being run like a well regulated MMF. -------- BTW, a money market fund is a mutual fund with regulations such that 1 share in the MMF is equal to $1. They are the already legal stablecoins you've been looking for. We can look at the performance of say, VMFXX, which has been $1.00000000 per share for the last 3 or 4 decades. Meanwhile, even the biggest Tether stablecoins floats to $0.998 or $1.001 regularly. Certainly doesn't show very much confidence in the scheme. This 6% staking or whatever, it's not stable. Never has been, never will be. You can't offer a better rate than the risk free rate unless you are willing to take on risk.
    - zeroclip 4y ago
      USDC does not offer yield, but it is still useful. Ethereum staking is actually a sustainable yield as long as there remains demand for block space.
      - dragontamer 4y ago
        No one just sits on USDC dude. They get it so that they can stake it on BlockFi at 7% or whatever. https://images.ctfassets.net/s9sj79zoigw1/4TEIhHwGu5G59I3oIxAaKU/d48aca400ce226ffdadd14ace2d8f5a3/Stablecoins__USDC__GUSD__PAX__BUSD__US.png https://images.ctfassets.net/s9sj79zoigw1/4TEIhHwGu5G59I3oIx... If you just turn USD into USDC, you end up losing money, because savings accounts are at 3% these days (https://www.capitalone.com/bank/savings-accounts/online-performance-savings-account/ https://www.capitalone.com/bank/savings-accounts/online-perf...). -------- People who want 1 fund == $1 get savings accounts and/or money market funds (depending on their risk tolerance. Savings Accounts are safer but earn less. MMFs have fewer regulations and can therefore offer slightly better rates but for that extra risk). Anyone promising 7% returns is lying to you. That's far above what even the "riskier" MMFs offer. ----------- Anyway, USDC is just a really weird bond market, where you end up offering loans (which are called "stakes" for some reason) to shady companies at far below market rates (ex: CCC Debt was 10% APY to 16% APY if you bought it on the open market. But if its "Staking" with BlockFi, it only earns 7%). Instead of thinking if these companies would return their money back, people handed money over-and-over to these other companies and wondered why it didn't come back. If you really want to lend money to shady companies, I suggest finding rated bonds (even junk bonds) and playing with that instead.
        zeroclip 4y ago
        > No one just sits on USDC dude Plenty do, and plenty just use it as a stable coin instead of chasing yield. > because savings accounts are at 3% these days Not everybody lives in the USA or want to do this.
  - rideontime 4y ago
    Ok? But once the yield disappears there'll be no reason to use defi.
zeroclip 4y ago
What exactly is going to happen? You can’t hide a multibillion $ black hole of debt in Uniswap.