A popular cryptocurrency analyst has studied a public blockchain protocol that supports a number of decentralized stablecoins as a possible solution for payments during the economic transition.
Popular YouTube channel InvestAnswers explained in a new video why decentralized stablecoins, notably open-source Terra (LUNA), can meet the future needs of both fiat and crypto users:
“I love LUNA. I believe decentralized, algorithmically based, fiat-pegged stablecoins are the future. They will be the mechanism by which all payments are made on the blockchain and perhaps in other parts of the world. We see a serious need in the world for alternatives to Fiat. Whether you are a government or an individual, everyone wants an alternative to fiat.
The host continues to discuss my future placements of specific stablecoins such as USD Coin (USDC), Tether (USDT), and Terra’s own TerraUSD (UST).
“I see UST and USDC as the top two. I’m a little worried about USDT. I don’t know what it looks like [or] how big it is, but it may come out one day and potentially put this UST in second place.”
Cryptocurrency analyst concluded that Terra, stating that crypto-based stablecoins face several risks, including government regulation and possible devaluation of fiat currencies,
“There are risks. Peg risk and regulatory risk are big issues. It also requires a stable crypto market to thrive… There is also heavy insider ownership, but demand is fixing that. The next 24 months are critical. But if they do, they could be huge.”
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