Cryptoverse: unstable stablecoins
STORY: This is Crypto Weekly, with your top stories on alternative currencies. This week, unstable stable coins give investors the jitters, and one shop tries live pricing.
Bitcoin is down around a fifth this month, hit by a broad crypto selloff.
The tumble was sparked by the crash of some so-called stablecoins.
They’re supposed to be 'stable' against the dollar.
But the past week saw TerraUSD, one of the biggest, fail to maintain its 1-to-1 peg against the greenback.
By Tuesday it was down to around 9 cents.
Rival coin Tether also struggled to maintain its peg.
Stablecoins have been hit by concerns over whether they can really stay stable, and general fears over what high inflation and rising rates mean for risky assets.
Some feared the crash could spark contagion across traditional financial markets.
R3 managing director Charley Cooper says that’s unlikely for now:
“If we were having this conversation two or three years from now in the future, and crypto, or stablecoins, made up a much greater portion of economic activity in the world, a precipitous drop, or the implosion of a stablecoin, like terraUSD, could pose a systemic risk.”
One London luxury store is trying to beat the wild volatility. It’s started offering almost real-time prices in cryptocurrencies.
The shop is the brainchild of German fashion designer Philipp Plein:
“So every 10 minutes we try to recalculate the price and update the exchange rate, which will help us to stay always on the right price for the consumer, OK?”
Goods for sale include a leather jacket for more than $12,000 - or whatever that might be in your chosen crypto right now.
