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Comment by Supermancho | Hacker News Reader

Why? Because the US stable coins are an abstraction on top of US treasuries. It's effectively trading in the US debt market, not trading in crypto-hype.

The Fed is interested in converting the debt to another medium, for obvious reasons. Stablecoin looks to be the leader, since a number of the new administration have talked about it in the last decade (re: Scott Besset stablecoin speech).

I can understand why some companies want their runway in a currency that may go up during a transition (a more favorable exchange rate). There's little lossage in the exchange of USDT/USDC in the short term. Seems like a hedge strategy.

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> ... US stable coins are an abstraction on top of US treasuries...

Nope. Not until these companies allow an independent external audit. I don't take "trust me" from a crypto bro as proof of backing funds.

Oh, and the current administration is clearly corrupt, so this administration wanting to convert the US to bozo bucks isn't one for the plus column.

The why stands. If the Fed got involved in transitioning the currency, which seems MORE likely under this administration (because of the grift and corruption), then they will be negotiating with the stable coin providers and the grift will follow the normal trajectory to the moon or whatever. The arbitrary "not until some independent shows the paperwork" will never be on the table.

Independent audits aren't arbitrary. They're the standard by which you can tell whether an organization is lying about their finances. Double entry accounting and receipts makes it pretty difficult to fake especially when the claim is as simple as "don't worry, we hold the backing value in treasuries." Of course, the independent part has to be truly independent and not paid for by the audited. But they refuse independent audits.

> I don't take "trust me" from a crypto bro as proof of backing funds

This is a good distillation of the inherent issue going forward with crypto. The people in tech I trust _least_ (cryptobros) are selling in a service that I require the _highest_ level of trust (finance). It's a very bad sales pitch.

You don't buy stablecoins because you trust them. You buy them because a greater idiot will. For that reason, I wouldn't be particularly bothered about getting them instead of dollars, though I'd try not to hold on to them terribly long.

You buy bitcoin because you think there's a greater idiot. You buy stablecoins as a step in the path to buying bitcoin. You don't buy and hold stablecoins.

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