How Should Washington Regulate Stablecoins?

The Breakdown

Blockworks

Investing, Business

4.8 • 806 Ratings

🗓️ 16 May 2022

⏱️ 14 minutes

🔗️ Recording | iTunes | RSS

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Summary

This episode is sponsored by Nexo.io, NEAR and FTX US. On today’s “Long Reads Sunday,” NLW features: 0-100 on Stablecoin Design by Spencer Noon On algorithmic stablecoins & the UST collapse by Jake Chervinsky - Nexo is a secure crypto exchange and crypto lending platform. Buy 40+ hot coins with your bank card in seconds and swap between exclusive pairs for cashback. Earn up to 17% interest on your idle crypto assets and borrow against them for instant liquidity. Simple and secure. Head over to nexo.io and get started now. - NEAR is a blockchain for a world reimagined. Through simple, secure, and scalable technology, NEAR empowers millions to invent and explore new experiences. Business, creativity, and community are being reimagined for a more sustainable and inclusive future. Find out more at NEAR.org. - FTX US is the safe, regulated way to buy Bitcoin, ETH, SOL and other digital assets. Trade crypto with up to 85% lower fees than top competitors and trade ETH and SOL NFTs with no gas fees and subsidized gas on withdrawals. Sign up at FTX.US today. - Consensus 2022, the industry’s most influential event, is happening June 9–12 in Austin, Texas. If you’re looking to immerse yourself in the fast-moving world of crypto, Web 3 and NFTs, this is the festival experience for you. Use code BREAKDOWN to get 15% off your pass at www.coindesk.com/consensus2022. - Enjoying this content? SUBSCRIBE to the Podcast Apple: https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M= Join the discussion: https://discord.gg/VrKRrfKCz8 Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW - “The Breakdown” is written, produced by and features Nathaniel Whittemore aka NLW, with editing by Rob Mitchell, research by Scott Hill and additional production support by Eleanor Pahl. Jared Schwartz is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsors is “Catnip” by Famous Cats and “I Don't Know How To Explain It” by Aaron Sprinkle. Image credit: SEAN GLADWELL/Getty Images, modified by CoinDesk. Join the discussion at discord.gg/VrKRrfKCz8.

Transcript

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0:00.0	Welcome back to The Breakdown with me, NLW.
0:09.1	It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
0:14.9	The breakdown is sponsored by nexo.io, near an FtX, and produced and distributed by CoinDesk.
0:22.7	What's going on, guys? It is Sunday, May 15th, and that means it's time for Long Reads Sunday.
0:29.7	Now, as you might imagine, this week has been a pretty juicy one on Twitter.
0:35.7	Because of that, I thought it would be good to just round out this stable
0:39.1	coin week with a few threads that I thought were really useful or particularly educational
0:43.9	in the wake of all of this. I promise we will start talking about other things again soon,
0:48.8	but for this week, we are talking stablecoins still. Before we get into that, however,
0:53.1	if you are enjoying the breakdown,
0:54.6	please go subscribe to it, give it a rating, give it a review, or if you want to dig deeper into
0:58.9	the conversation, come join us on the breakers discord. You can find a link in the show notes or go to
1:03.5	bit.e.combeckdown pod. Also a disclosure, as always, in addition to them being a sponsor of the show, I also work with FtX.
1:11.7	All right. So our first thread comes from Spencer Noon, the co-founder of Variant Fund,
1:16.6	and it's really just an educational 101-style fund. And I'm reading this because I believe that
1:21.3	some number of you may not fully have had the time to get into what stable coins are, how they
1:26.5	work, and how to frame UST and
1:28.3	Luna in that context. Spencer says, first, what are stable coins? A stable coin is a crypto
1:34.2	asset whose price is pegged to the reference price of a reserve asset. The most popular reserve
1:38.4	asset for stablecoins is one US dollar. Stablecoins have a combined market cap of more than
1:43.0	$170 billion. I'll look at the market
1:45.0	prices of the top 10 stable coins on Coin Gecko, and we can see that not all of them are functioning
	...

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