Should I invest in USDM, the interest-paying stablecoin?
09/20/2023 •
Maybe. — Majority of the comments are positive about investing in stablecoins, especially due to the potential to earn interest. Regulatory compliance, as seen with Coinbase's interest rate increase for USDC after the SEC's stance, suggests a positive environment for stablecoin investments. There are concerns but they primarily revolve around diversification and understanding specific stablecoin structures.
Stats
| 79% | 19 | |
| 12% | 3 | Mastodon |
| 8% | 2 | Hacker News |
| 46% | Neutral |
| 30% | Positive |
| 24% | Negative |
| 62% | 😃 Joy |
| 17% | 😡 Anger |
| 17% | 😱 Fear |
| 4% | 😯 Surprise |
| 0% | 😢 Sadness |
| 0% | 🥰 Love |
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Story
- USDM is an interest-paying stablecoin.
- There is a viewpoint emphasizing the importance of diversification in stablecoins, mentioning stablecoins like USDC, USDT, DAI, and PAX Gold as potential options.
- Some individuals highlight the benefits of earning interest on stablecoins, with platforms like Ledn Growth Accounts supporting both USDC and USDT, offering 8.5% annual interest.
- Concerns have been raised about the stability and trustworthiness of stablecoins, with comparisons to the zero-interest-rate phenomenon (ZIRP) and skepticism about sending dollars to companies without federal insurance protection like Tether and Paxos.
- There's mention of Coinbase increasing the interest rate on USDC after the SEC confirmed its stance on stablecoins, implying regulatory compliance.
- USDT is considered by some to be the strongest stablecoin due to its association with the US government.
- An opinion suggests that stablecoins like USDT and USDC have heightened crypto's dependence on the US economic landscape, with Bitcoin trading against the dollar indirectly through these stablecoins.
- Speculation exists about Coinbase potentially lowering USDC interest rates by the end of the year, considering the trend of rising US interest rates.
- Some views see Coinbase's increased interest rate on USDC as indicative of needing a higher supply of stablecoins and reflect concerns about fewer assets being held in centralized exchanges after events like the FTX debacle.
- Comments have compared USDT to bank deposits, specifically mentioning the "bank run" incident experienced by the Circle-issued USDC stablecoin. USDT is seen to avoid such risks because it's backed by the full faith and credit of the US government.