Sorry, but There's Nothing Stable About Bitcoins or Stablecoins
The article argues that neither Bitcoin nor stablecoins are truly stable assets. It criticizes the volatility of Bitcoin as a store of value and questions the reliability of stablecoins, suggesting they are not as secure or stable as their proponents claim.
Background
- Bitcoin: the original cryptocurrency, launched in 2009, known for extreme price volatility despite a fixed supply.
- Stablecoins: crypto tokens (e.g., USDT, USDC, DAI) designed to hold a steady value, usually 1:1 with the US dollar. They are meant to combine crypto's speed with fiat stability.
- The article's author, John Tamny, is a Forbes editor and free-market commentator who has long criticized Bitcoin as failing to be a real currency.
- The debate matters because the crypto industry increasingly promotes stablecoins as the "safe" on-ramp for payments and DeFi, while regulators worldwide are tightening rules around them.
- Key unresolved tension: if stablecoins are backed by dollars or Treasuries held in banks, they are essentially digital IOUs, not independent money — meaning their "stability" depends entirely on the traditional financial system they claim to replace.