Of all people to become the face of stablecoins in the mainstream media, it's … Mark Zuckerberg? Seriously? The CEO of facebook was grilled on Capitol Hill last week about Libra, its proposed stablecoin cryptocurrency, and it was rather… unpleasant.
As the co-founder of the world's first stablecoin, Tether, you can say that William Quigley knows a thing or two about stablecoins. Which is exactly why he's incensed at how they're being portrayed in the media in light of facebook's announcement of the Libra Project, then its loss of some high profile founding members like PayPal, and finally Zuck's testimony before the House Financial Services Committee.
"There should be no opposition to the idea of a stablecoin," says William. "Stablecoins are a gift to consumers, and they're a gift that benefits all the companies using them.
So what's so great about stablecoins? Watch William's latest episode of WAX ON to find out, and subscribe to the WAX YouTube channel for more episodes of WAX ON with William Quigley each week.
How did Mark Zuckerberg become the face of stablecoins? How did we get so unlucky?
Pitching the merits of a stablecoin is like pitching the merits of, I don’t know, running water or penicillin, or higher education. There should be no opposition to the idea of a stablecoin. Stablecoins are a gift to consumers, and they're a gift that benefits all the companies using them.
What is so great about a stablecoin? Lets run through a few of the reasons:
First, they're cheaper. They're cheaper because stablecoins operate on a single transparent global network. That network of course is a blockchain. There’s no cheaper way to send a payment to anyone else in the world.
They're also faster and more reliable. They come with near instant settlement. Because again, the stablecoin is transferred from one party to another on a single network. No hopping across a bunch of different banking and payment networks. When you have to do that, you pay the penalties of low speed, low transparency, and high costs. Your payment has to hop through all those gatekeepers and all those toll collectors.
What else? Well stablecoins are not credit cards. You’re transferring direct cash. They're what we call a bearer instrument and why is that important? Because it addresses one of the biggest issues in the payment industry and that’s fraud. There are no chargebacks with stablecoins and no chargebacks means that the companies don’t have to pass along the fraud costs to their consumers, and that just means you have to pay less for every payment you make. What would the U.S. Congress have against that?
Now finally stablecoins are perfect cross-border payment mechanisms. Why? Because you don’t have currency conversion costs when you have stablecoins. You don’t need to exchange your $20 USD for an equivalent amount of a foreign currency like a Euro. Currency conversion costs are like a giant tax on humanity. Currency conversion costs amount to somewhere between $750 billion to $1 trillion annually. So with an $80trillion in global GDP every year, currency conversion costs are like a hidden tax on everything you buy from a foreign company.
So let’s remember - facebook is a global business, it has 2 billion customers. 80% are outside of the U.S. So it makes sense that facebook would be looking for a better, cheaper, and fairer way to facilitate payments for all those people.
We clearly need someone else to help educate the US congress about the vast positive potential of stable coins other than Mark Zuckerberg
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