As cryptocurrencies spike today, Cointelegraph writer Connor Blenkinsop is covering some of the institutional enthusiasm that may direct what happens with blockchain and crypto in the future.
Explaining some past comments by Binance exchange CEO Changpeng Zhao, Blenkinsop notes the entrepreneur’s vocal support for stablecoins – coins that are tied to a fiat currency unit for unit instead of just fluctuating on markets.
“Binancehas unveiled a series of new products and features relating to stablecoins,” he writes, “with the world’s largest cryptocurrency exchange describing these digital assets as “an efficient fiat gateway into crypto.”
A major part of the argument seems to be that stablecoins will sort out ambiguity around conversion rates.
“Given how the prices of other coins and tokens can change dramatically in a matter of minutes, this increasingly popular form of cryptocurrency could help deliver the certainty that many everyday consumers want and expect,” Blenkinsop writes, citing input from Zhao on stablecoin benefits. “Over time, it could also enable the industry to build a compelling case for mainstream adoption — addressing some concerns that many digital assets amount to a store of value rather than a currency that can be used for everyday purchases.”
This idea of driving mainstream adoption is one that has captured the imaginations of more than one trader, as many of us look forward to the potential of the “year of the blockchain” seeing the sparks already catching.
Zhao has also cited minimal fees for converting U.S. dollars into stablecoins and vice versa. The argument goes that users can avoid wire transfer fees and traditional SWIFT payments by converting a fiat currency into a stablecoin and then sending it around the world or into some obscure market and back again.
If you think about the idea that money makes a journey when it changes hands, all of this kind of makes sense. Blenkinsop notes that stablecoins are expected to play a significant role in blockchain adoption as countries in various regions of the world look to stabilize their own currencies and economic systems. Take a look and see how this might fit into your crypto strategy.