Cryptocurrency

Buterin makes the case for alternative stablecoin technology in high inflation environment

Vitalik Buterin said the crypto industry would benefit from developing new forms of stability away from dollar-pegged stablecoins.

Responding to Coinbase CEO Brian ArmstrongWhen asked if there is room in the market for coins pegged to consumer prices, Buterin explained the limitations of fiat-backed stablecoins, especially in high-inflation environments. Alluded to Jesus.

Examples of New Cryptocurrency Stablecoin Technology

Buterin said the industry should move away from relying on a single asset to create a better inflation-proof currency.

“Crypto should prepare to move away from over-reliance on certain types of assets.”

Addressing USDC, the Ethereum co-founder pointed out the systemic risks associated with popularity. Among them, popularity often brings political clout, resulting in infighting and hard forks.

In addition, he also raised the question of “if anything happens to the US” or what happens to the dollar.

As such, Buterin believes there is a need to “get a grip on” a stability measure related to consumer prices, much more than a measure related to a particular fiat currency.

The co-founder of Ethereum has commented on Bitcoin maximalist claims that Bitcoin will be stable if it becomes widely adopted, saying that this line of thinking is not a “sober assessment” of all possibilities, but an “article of faith.” ” said.

runaway inflation

Fed Chairman Jerome Powell said households and businesses should take inflation into account as it will take time to contain it. The comment is Economic Policy Conference in Jackson holeWyoming, August 26.

The market initially responded by selling, and this pattern continued into the next week. Bitcoin lost his 7% of its value during this time. Similarly, Ethereum fell 8%.

inflation is Federal Reserve Bank First interest rate hike 3 yearsBut half a year after that hike, the reality of the situation has now permeated the public.

Following Powell’s speech, the president of the Federal Reserve Bank of New York John Williams He said it would take “several years” to reach the target of reducing inflation to 2%. It further shows that the situation is out of control.

“The situation is very difficult. Inflation is very high. There are many reversals in the economy. I think it will take a few years, but we will definitely make it through.”

On the other hand, commenting on the skyrocketing energy prices and the cost of living crisis, goldman sachs predicted that UK inflation could reach 22% in 2023. If this scenario materializes, an economist at the investment bank predicts that UK GDP will fall by 3.4%.

Elsewhere in Europe the situation is much the same, with high prices weighing on household budgets and squeezing consumer confidence.

Eurozone inflation soars 9.1% – Highest level on record and further pressure on the European Central Bank (ECB) to carry out a major hate hike at its September meeting of officials.

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