Editor’s note: from the original bitcoin, author Jamie Redman, compiled by the Odaily daily planet Qin Xiaofeng, reproduced please specify the source.
In the past two years, stable currency has gradually become a hot topic, it has also become an important tool to hedge encryption volatility in currency markets.
At present, stable currency is facing two big issues: one is of vital importance to the stability of the renminbi will keep its promise, stability and mobility, especially during the market crash; another is that current legal status by stable currency questioned whether through regulatory review.
Stable currency may belong to the category of securities
Tether (USDT) has been known as the dollar, once a stable currency king. Although in the past two years, USDT has repeatedly questioned the lack of funds, reserve inflated USDT, but it is still the highest market value ($2 billion), the largest stable currency.
However, recently, because the Tether company to modify the site terms and again made headlines, and caused a great disturbance, Tether was deleted in the monetary field before encryption on USDT completely by dollars to support “.
The company’s official website now writes:
Each one Tether is supported by 100% of our reserve assets (these assets), including the traditional currency and cash equivalents, sometimes may also include other assets and Tether payment to third party loans receivable, which may include affiliated entities (collectively referred to as the “reserve fund”).
In the Tether to modify the terms of the day after (March 15th), the US Securities and Exchange Commission (SEC) senior consultant Valerie Szczepanik said, according to the current securities law, stable currency may encounter problems. She will also stabilize currency divided into three categories: the first stable currency is associated with gold or real estate and other real assets; the second category is the legal currency reserve and the related; third is the use of market mechanism to maintain price stability.
In these projects (stable currency), a system with a centralized, over time it can control the price fluctuations, so these projects (stable currency) may belong to the category of securities. If the buyer is a promise, others will hold (stable currency), guarantee profits, control the price, then the token (stable currency) is securities.
The Szczepanik statement and SEC chairman Jay Clayton last week issued a statement the statement revealed stable currency agree without prior without previous consultation, belongs to the category of securities. Whether it is a reserve bank support, excessive security methods or publishers in favor of the stable currency is essentially a kind of commitment, which is also a kind of securities.
Finally, Szczepanik added, both assets are marked as stable currency or any other things, the SEC will always review of the project. She pointed out that:
It sounds a bit hackneyed and stereotyped expressions, but we prefer people to come to us and ask (license), or before they do something first with us through a gas, rather than do sth to ask for forgiveness.
In December last year, stable currency startup Basis because of fears that its products will be regarded as securities and are forced to close business. As for the Tether stable currency can eventually through SEC and other regulatory agencies to review, at present is still unknown.
Stable currency may not be stable
Although the major stable currency commitment and the dollar, the proportion is 1:1, but the fact is that the stable currency may not be stable.
The first factor of instability is the shortage of funds. Last 10 month 15 days, then Tether is lack of funds caused panic in the market, the price fell to $0.93 USDT. Although after Tether released its shots in the Marshall Islands bank reserves, but skeptics have never dispel doubts.
The second factor is not stable for the authenticity of the reserves are still lack of transparency. Trusttoken (TUSD) solution is given to provide real-time query reserves. They cooperate with the Armanino audit of the company, users can view real-time dashboard on specific reserve status. This is no doubt that the authenticity of evidence can cash in reserve.
The three source of instability in the collateral price fluctuations. Stable currency DAI by ETH excess mortgage to ensure DAI prices remain stable. The so-called excess collateral is 150 $ETH only lend $100 DAI interval, set aside enough wind control.
However, analysts pointed out that if the ETH Bennett Tomlin, prices plummeted, unless the team quickly sold off, otherwise it will be the problem of currency stability. Here is a problem related to the current DAI system in total ETH mortgage 210 million, if ETH prices plummeted, a short period of time can really sell it? If the sale is not finished, the price of DAI will be difficult to guarantee. This problem, DAI has not given a clear solution.
The stability of the existing currency category (USDT, GUSD and DAI) in what can go far, the current can make nothing of it. But there is no doubt that the money market is stable and will not disappear with the stable currency of death.