Post
Topic
Board Altcoin Discussion
Re: How do you feel about algorithmic stablecoin staking?
by
ItsNotSean
on 10/05/2022, 07:51:37 UTC
Stablecoins like UST, USN, USDD have a very tricky link to the dollar and the collateral pool, in the form of a native token of a particular blockchain, be it LUNA, NEAR, TRON, etc. Such projects offer or are about to offer 20-30% per annum in staking these stablecoins. Not a bad interest rate, is it? But will these projects be able to provide such a high interest rate all the time, and won't that provoke a cascading collapse of both the stablecoins, with the loss of the peg and a cascading collapse of the native tokens that act as reserve collateral?

After all, such high payouts to stakers must be accompanied by constant replenishment of these projects reserve funds. But what will happen if the money stops flowing in the right amount?
This post aged ... poorly. LOL. Over the course of two weeks.

Algorithmic stablecoins backed by cryptocurrency are all done now.