Stablecoins

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The fundamental problem with stablecoins is that they are tied to the USD, a fiat currency known to be losing its value at roughly 10% per year. Other problems include the fact that you can't self-custody, i.e. the keys can't be buried in your backyard.

Nevertheless, for most of the world, stablecoins (specifically Tether) are a godsend because the fiat currency of their countries are so much worse than USD. Everybody outside the US wants USD.

Gresham's Law: "Bad money drives out good." In other words, when there are two forms of currency in circulation, one that is of lesser intrinsic value (bad money) will be used in transactions, while the more valuable currency (good money) will be hoarded or exported.

It is also useful to note that Tether is being embraced by the US Government because it has become one of the largest buyers and holders of US Treasuries. As other nations start rejecting US debt, Tether is beginning to serve as the vehicle to vacuum it up.

Refinancing US Debt onto the World



Tether will help prolong USD's survival and dominance around the world. US politicians are embracing it.


Announcement by US Treasury Secretary Scott Bessent at the US Digital Assets Summit, March 7, 2025: "we are going to keep the US the dominate reserve currency in the world and we will use stablecoins to do that."
(7-second video)






Dense and entertaining 12-minute presentation of how Tether, while currently dollarizing that world, is ultimately a Trojan horse for the adoption of Bitcoin.


An even bigger perspective is that this is yet another proof that the entire financial world is being reprogrammed to operate on top of Bitcoin rails. Bitcoin ownership is a simple way to get hugely diversified exposure to the productivity of the new decentralized world. Simply having bitcoin "under the mattress" will allow one's value to rise as the new Googles, Facebooks, Visas, Wells Fargos, etc. are built on top of bitcoin to take advantage of its efficiencies and trustlessness—no middlemen needed for finality of transactions.

Tether CEO: "I expect a financial reset, where all national currencies will collapse and experience hyperinflation. Consequently, USDT will be completely useless, and at that point, I believe the world will only use Bitcoin." Feb 27, 2025 Interview

The bottom line is that Tether will be a huge simplification of the USD system by removing banks, weekends, personnel, banking holidays, credit cards, payment gateways, and dozens of other unnecessary middlemen from transactions. Tether will also benefit the world by removing the inefficiencies and complexities of 140 different fiat currencies.



But even longer term, people should be aware that Tether/USD continues to be a melting ice cube as its value is tied directly to the USD, a fiat currency. For anything other then day-to-day transactions, people should consider moving value into the harder, non-country-specific, equally convenient protocol/currency/commodity of Bitcoin.

One need only to look at a Bitcoin-to-USD chart to get a feel for the horrific long-term performance to expect from Tether.

Bitcoin priced in USD from 2016


  • Tether had more profit than Blackrock last year. With those retained earnings, they bought bitcoin. (2-minute video)



Tether privacy (2-minute video)



ALEX GLADSTEIN: “If stablecoins dominate, financial freedom dies quietly—If Bitcoin prevails, sovereignty becomes a default, not a privilege.” (1-minute video)



Saifedean Ammous, economic professor and author of "The Bitcoin Standard", explains why even Tether can't save the Dollar. It may be a good way to transition away from the Dollar (12-minute video)


Stablecoins are the New Free Market Banks

As stablecoins proliferate, it looks more likely that they will be the daily drivers that most people use as money. They will be backed by 100% Bitcoin reserves and be interchangeable on Lightning rails. Given their convenience and technological superiority, they will add increasing free-market pressure that force the Federal Reserve rates and inflation to be more reasonable.
(2-hour podcast)

Apple Podcasts | Audible

Comparing modern stablecoins to 19th-century free banking.
Original article: https://murmurationstwo.substack.com/p/the-last-word-on-stablecoins-and



Stablecoins: Nature Trying to Heal Itself

Why politicians were tripping over themselves to pass the Genius Act. (2-minute video)




Tether Runs on Bitcoin

January 30, 2025 - Interesting new wrinkle in the Tether/Bitcoin relationship: Tether announced that it will mint Tether directly on Bitcoin's Lightning network. Analysis is still coming (see this X post), but this move seems to make Tether more efficient, trustworthy, and universal. (1-minute announcement video)




Path to Tether as World Bank







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