>We really can't have centralized entities issuing stable coins, can we.

You can. It's called a 'bank' and they're heavily regulated.

Instead, what crypto has are wildcat banks. You've never heard that term because when they existed, 150 years ago, "[b]ank closures and outright scams regularly occurred, leaving people with worthless money."[1] Sound familiar?

[1] https://en.m.wikipedia.org/wiki/Wildcat_banking

Unfortunately DAI is also now collateralised by USDC, I read somewhere is up to 30% (haven't been able to verify) but I'm not sure what effect it'll have on DAI if USDC collapses. More here: https://www.reddit.com/r/MakerDAO/comments/nwydtj/what_is_th...

The reason the crypto world uses dollar-pegged tokens in the first place is for their relatively stable value. The downside is that obviously this stability is not perfect, and it's managed by a centralized entity, which as monstrously big and powerful it may be, is still a single point of failure with its own interests. The real ultimate solution is to detach from the US dollar and get value stability from somewhere else, e.g. RAI[1].

[1]: https://reflexer.finance/

Just hold BUSD if you're concerned, that really is safe, even in turbulent market conditions.

Not financial advice.