Importance of stablecoins in the crypto industry

[naturelover]

what is stablecoins?

Stablecoins are digital units of value that rely on stabilisation tools to maintain a stable value relative to one or several official currencies or other assets (including crypto-assets).

1. It is important for Defi platforms
such as:

liquidity pools
yield
futures/derivatives
lending
payments

2. It is also important for people who use dollars especially in p2p features.

3. Traditional worldwide transfer of dollars

4. Protection against volatility

Risk of Stablecoins

Smart contract
Depegging
Liquidity
Regulatory
Reserve
Issuer

[wewantmoolah2]

One useful distinction is between holding a token that targets one dollar and being able to redeem it directly with its issuer.

For example, Circle's USDC terms for holders outside the European Economic Area require an eligible Circle Mint account for direct redemption. They also state that USDC's price on third-party platforms can differ from $1. A dollar target therefore does not give every holder an unconditional, immediately usable redemption route.

Jurisdiction matters, too. Circle's separate EEA redemption policy provides a route for retail holders to redeem with Circle France, subject to eligibility and identity checks. That differs from assuming every USDC holder everywhere has identical access.

For the payments use case in your post, this suggests comparing two stages: getting tokens to the recipient, and getting usable local money into the recipient's hands. A quick blockchain transfer only tells us about the first stage. The second can involve service availability, conversion costs and banking requirements.

For cross-border payments, how should we compare the full cost and time until the recipient can actually spend the money?

[naturelover]

One useful distinction is between holding a token that targets one dollar and being able to redeem it directly with its issuer.

For example, Circle's USDC terms for holders outside the European Economic Area require an eligible Circle Mint account for direct redemption. They also state that USDC's price on third-party platforms can differ from $1. A dollar target therefore does not give every holder an unconditional, immediately usable redemption route.

Jurisdiction matters, too. Circle's separate EEA redemption policy provides a route for retail holders to redeem with Circle France, subject to eligibility and identity checks. That differs from assuming every USDC holder everywhere has identical access.

For the payments use case in your post, this suggests comparing two stages: getting tokens to the recipient, and getting usable local money into the recipient's hands. A quick blockchain transfer only tells us about the first stage. The second can involve service availability, conversion costs and banking requirements.

For cross-border payments, how should we compare the full cost and time until the recipient can actually spend the money?

Your question is very good, and it really make sense as well to answer it actually,
here's my view on this matter.

Due to as we all know that we are not talking about only transaction fee here instead we also discussing other things such transaction cost, time, spread, network fee and more before the recipient receive the fund we are sending it.

[Italian Panic]

Stablecoins have been a godsend because they have meant that many investors no longer have to cash out into fiat currency and, above all, they have kept a lot of people within the crypto system who would otherwise have seen a steady exodus with no return.
For long-term hodlers, they will always stick with their chosen crypto, but for those who sell at the top and buy at the bottom, tools such as stablecoins are essential.

[naturelover]

Stablecoins have been a godsend because they have meant that many investors no longer have to cash out into fiat currency and, above all, they have kept a lot of people within the crypto system who would otherwise have seen a steady exodus with no return.
For long-term hodlers, they will always stick with their chosen crypto, but for those who sell at the top and buy at the bottom, tools such as stablecoins are essential.

You're right, stablecoins are just as physical as fiat like Usdc and usdt, they're just digital and intangible but with the same value. And many investors are using stablecoins so that if they feel that the value of the assets they have is really going down, they will sell them and exchange them for stablecoins so that the value doesn't disappear.

And this is just one of the beauty of stablecoins, besides other features that they are used in p2p, futures and others based on what I've learned here, to be honest.