In today's edition of YIYL, (You Invest, You Lose) we take a look at the clueless bunch that runs blockchain projects. These guys got funding pretending they could create perpetual money machines and it hasn't worked out, go figure!
Even after Do Kwons epic failure, the idea that you can create algorithmic stablecoins lives on. I've already tackled this, you can't you always need someone handling open market operations so it can only be managed on a small scale too insignificant to matter to anyone.
Once you try to scale it you're in for a shit storm, and Terra proved that, but I guess failing at the same thing with a new brand name is how crypto works.
USDN or USD END!
During the time of creating dollars out of thin air UST was the primary ponzi, but there were secondary ponzis like USDN (or Neutrino Dollar) is an algorithmic stablecoin in the Waves ecosystem, pegged to the US dollar.
USDN offered a similar mechanism to anchor with staking’s average annual yield is around 12–15%, and managed to reach a market cap of 1 billion dollars before imploding in on itself.
The USDN stablecoin remained within a few cents of its intended USD peg for about a year, before losing its peg in April. Since then, it has had a pretty bumpy road, spending much of the year more than a few cents off the dollar peg, and today trades at 50 cents, so anyone who held this shitcoin scam got cleaned out by half.
Imagine thinking you're safe from volatility form the shitcoin market and then the stablecoin shitcoin you're in leaves you with a 50% haircut and not much liquidity to dump into in any case lol
Well imagine no more, simply ask anyone who held USDN for more than a year.
It can't fail twice, can it?
Sasha Ivanov, founder and CEO of the Waves blockchain platform, has promised his bag holders that he has a plan. He will be launching a new stablecoin shitcoin and with it a plan to bail out USDN bag holders.
Now anyone with a brain knows you don't try to save distressed assets, you're taking on a liability for what upside? So wtf is going on there I don't know?
Only thing I can think of is your USDN gets swapped at a set recover price like 10 cents on the dollar or you can get 1-1 but yours has to be locked up for a long ass time and then repaid back with fees generated by the new stablecoin, if that is even possible.
https://twitter.com/sasha35625/status/1605135291802451969?s=20&t=sj6s1lfyBB-ZX9wc8wxs2g
- sasha35625
As you can imagine some people are pretty tired of hearing this nonsense but still hold out some hope following these shitcoin scammers. A less-than-enthused commenter responded to Ivanov's Twitter announcement of a new coin, writing,
"My brother in Christ more stablecoins to depeg is not the answer".
"It will be undepeggable", replied Ivanov. Well, in that case.
Stablecoins are more like stablecons
There is no such thing as a undepeggable stablecoin, never has and never will, even the US dollar itself trades for different prices depending on where you are in the world.
Trying to keep a peg even with a central bank backing you has been a tough task, ask the guys managing the Hong Kong Dollar and the Lebanese pound how well that worked out for them.
As long as founders can fool investors into thinking you can code away reality, you'll see this scam repeat over and over. I personally look forward to seeing how this new stablecoin blows up and takes a new set of clowns down with it.
At some point, you will see these fails force regulation and anyone minting stablecoins will need to be a registered money market fund with regulation and compliance eating into profits, many of them will balk and die off.
As for now this grey area will continue to see scammers claiming they can create dollars out of thin air.
Source:
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