Speaking on a panel at the Unitize digital conference, Peter Dittus, chief economist at SFB Technologies, said he sees a place for private broadcast stablecoins.
„I don’t see a big future for them,“ Dittus said of the stablecoins on the June 7 panel, broadcast live by Cointelegraph.
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There are two types of stablecoins
Stablecoins exist in two categories: those issued privately and CBDCs, according to Dittus. Those issued by governments, or CBDCs, are essentially converting cash into digital, and each coin represents the value of the nation’s currency to some extent.
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Privately issued stablecoins often also hold the value of several national currencies, although these assets are managed by private entities, not governments. Tether’s USDT is a vivid example of a private stablecoin.
„If you have a stablecoin issue, I’m not sure what your point is,“ Dittus said. „It may be a matter of the Internet of things, a kind of small payment thing, I can see that, but otherwise why would you use it,“ he added, pointing out the presence of all the other digital payment forms available. PayPal and Venmo exist as two such examples.
„What is the unique selling position for a stablecoin issued by a private consortium?“ Dittus added. However, he mentioned the potential of native assets of certain platforms, such as Facebook or Telegram, which take advantage of the massive customer base of their entities.
Dittus sees value in CBDCs
Although he did not express enthusiasm for private broadcasting stablecoins, Dittus does see potential in the CDBC. „They obviously have significant potential because they have all the support, legal and economic power in the country behind them,“ he said.
„From the point of view of someone who owns them, it’s a credit risk-free asset,“ he added.
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Dittus also mentioned his interest in a different type of Bitcoin Trader for inflation-torn nations like Argentina, which would base its value on other assets such as precious metals or goods rather than on currency.
„If you have a stablecoin that is linked to the bolivar, who would be interested in that,“ Dittus said, referring to Venezuela’s paper currency. The country has seen rising inflation in recent years, reaching 10,000,000% in 2019.