Why Stablecoins Are So Important

TL;DR

• Colombia’s largest financial institution, Bancolombia, has entered the crypto enterprise by launching a crypto change and a stablecoin, which acquired us enthusiastic about the worth of stablecoins.

Full Story

Colombia’s largest financial institution, Bancolombia, has entered the crypto enterprise by launching a crypto change known as Wenia.

On the similar time, they’ve launched a stablecoin known as ‘COPW,’ which is pegged to the Colombian peso.

That information is cool and all, however the vital matter it acquired us enthusiastic about is that this:

A lot of folks (on either side of the fence!) appear to suppose that there’s solely room for both crypto or conventional finance, however no room for them to co-exist.

We’re right here to let you know that’s bullsh*t.

Take a stablecoin like COPW for instance – it actually couldn’t exist with out having a fiat foreign money to be pegged to.

Positive, there are different stablecoins which can be pegged to the worth of gold and different commodities, however in the long run the worth of these can fluctuate significantly too, making them troublesome to be ‘steady’ stablecoins.

(To not point out algorithmic stablecoins á la UST 😐)

We’re unsure that crypto will ever be the dominant foreign money of the world – and that’s not essentially a nasty factor.

However there’s a vital place on the planet for stablecoins.

For instance, in case your nation’s fiat foreign money is experiencing hyperinflation proper now, however you have the chance to place it on an change and convert it for one thing like USDC; abruptly your foreign money will solely inflate as a lot as US {Dollars} inflate – nonetheless comparatively excessive, however not catastrophic.

All of that is to say that we like to see an organization which is so deeply engrained within the conventional finance area (actually a financial institution) transfer into the crypto area with the view to onboard their customers into crypto.

Kudos to you, Bancolombia.