Crypto should have been cut off from the fiat dollar system and smothered in the crib a decade ago but that ship has sailed. In terms of actual financial system risk this is tinkering around the edges at worst. Stablecoins are a bigger risk.
Replies
Bitcoin earnings are out: REVENUES: $0 EPS: $0.00 GUIDANCE: $0
aug 5, 2025, 2:26 am • 3 1 • view
we can smother in a bigger crib
aug 5, 2025, 1:12 pm • 0 0 • view
Because stablecoin provides convertibility to USD, but without the U.S. banking regulatory paradigm?
aug 5, 2025, 1:49 am • 0 0 • view
My favorite type of stablecoins are those that rely on other stablecoins to stay stable.
aug 5, 2025, 1:43 am • 15 0 • view
I wish this was a joke and im sure some people actually think it is.
aug 5, 2025, 12:48 pm • 4 0 • view
💯
aug 5, 2025, 2:03 am • 0 0 • view
Have you consider it’s all bullshit like the universities, law firms, and media conglomerates and they are just looking to extort money and exert political control over the banks next?
aug 5, 2025, 2:10 am • 3 0 • view
The issue with stablecoins is they create large pools of assets which need to be invested in liquid securities (think t-bills, commercial paper, deposits). And outflows from a given stablecoin could drive a run on the deposits of an otherwise sound bank.
aug 5, 2025, 1:01 pm • 108 15 • view
Yeah we saw… not this but a preview of what this could look like when we learned that USDC was one of the biggest accounts at SVB at $3.3B, which was nearly 10% of Circle’s deposits
aug 5, 2025, 2:46 pm • 4 0 • view
This NBER study works through the liquidity problems at the heart of the stablecoin model. www.nber.org/papers/w33882
aug 6, 2025, 10:50 am • 16 3 • view
Especially since the GENIUS act put STABLECOINS ahead of depositor claims.
aug 5, 2025, 1:12 pm • 4 0 • view
The assumption is that if they're only invested in t-bills, they won't run.
aug 5, 2025, 2:43 pm • 0 0 • view
if they're only invested in t-bills then it's a non-issue for banks anyways
aug 5, 2025, 2:45 pm • 2 0 • view
It's quite an issue if they cannibalize deposits.
aug 5, 2025, 2:47 pm • 3 0 • view
Sorry I meant non-issue for run risk. Deposit cannibalization is an issue but that's a challenge to the income statement not solvency IMO.
aug 5, 2025, 2:48 pm • 3 0 • view
Well, it depends on how they're regulated in the end. If stablecoins issued by institutions like JPM and others are regulated to not hold more than a certain percentage of assets for that purpose, I don’t think there’d be an issue.
aug 5, 2025, 9:42 pm • 0 0 • view
Stable coins would need the discount window lol.
aug 5, 2025, 1:04 pm • 10 0 • view
why is this risk different from the risk of outflows from money market funds that are invested in t-bills, CP, and deposits?
aug 5, 2025, 3:17 pm • 0 0 • view
lack of regulation basically. MMMFs have all sorts of requirements around run risk.
aug 5, 2025, 3:19 pm • 5 0 • view
MMMFs... the extra "M" is for extra regulations requiring more assets classified as DLA/WLA
aug 5, 2025, 3:24 pm • 1 0 • view
Deprecate stablecoins and market tokenized MMF in their place then, I suppose
aug 5, 2025, 3:26 pm • 0 0 • view
MMMF = money market mutual fund
aug 5, 2025, 3:48 pm • 1 0 • view
I sincerely do not understand the appeal to offering a stablecoin other than “other banks are doing it”
aug 5, 2025, 1:36 pm • 5 0 • view
Don’t they collect transaction fees?
aug 5, 2025, 2:44 pm • 2 0 • view
Like it’s riskier than simple custodianship idgi
aug 5, 2025, 1:36 pm • 4 0 • view
The biggest knock against these coins are that they have no reason to exist.
aug 5, 2025, 2:42 pm • 1 0 • view
does this not A->B towards empowering stablecoins (spits)?
aug 5, 2025, 1:54 am • 3 0 • view
I don’t think this order is as important as the act passed by Congress a couple weeks ago in that respect tbh.
aug 5, 2025, 1:55 am • 6 0 • view
I’m not clear on stablecoins: if their underlying assets are dollar-denominated, it’s like saying U.S. debt is a threat to the dollar...
aug 5, 2025, 12:25 pm • 0 0 • view
Does it include giving margin loans with crypto as collateral?
aug 5, 2025, 1:41 am • 0 0 • view
Doubt it. Margin loans are also one of those things where the devil is in the details. Offering $1 of margin for $10 worth of bitcoin is never going to be particularly risky, especially if it’s hard pledged (i.e. the lender has control of the assets on chain). $9…different story.
aug 5, 2025, 1:48 am • 2 0 • view
I was thinking 30% margin. $3 for $10…
aug 5, 2025, 1:50 am • 1 0 • view
I wonder if that would have been possible, but as you say, it's academic now.
aug 5, 2025, 1:46 am • 1 0 • view
Thank you!
aug 5, 2025, 2:42 am • 0 0 • view
Smothered in the crib is a v strong bid.
aug 5, 2025, 1:10 pm • 0 0 • view
What are possible stablecoin risks - some bad actor putting the cash in risky stuff instead of t-bills, then losing the peg?
aug 5, 2025, 1:42 am • 3 0 • view
Basically a run like the kind that hit SVB
aug 5, 2025, 1:48 am • 10 0 • view
Yeah exactly. If you’re a bank and a lot of your liabilities are held by stablecoins that could get spicy.
aug 5, 2025, 1:49 am • 17 0 • view
Tether can print dollars out of thin air (and likely has)
aug 5, 2025, 1:46 am • 2 0 • view
Definitely has in the past.
aug 5, 2025, 12:25 pm • 0 0 • view
New ethical dilemma: if you could go back in time and smother baby Satoshi, would you do it?
aug 5, 2025, 1:58 am • 4 0 • view
Here, here!!
aug 5, 2025, 2:39 am • 0 0 • view