If it were possible to create a “stablecoin” that had a fixed value with respect to fiat currencies, it would relieve a great deal of the public’s concern and anxiety about using cryptocurrencies. Hundreds of articles have been published since on the subject of stablecoins. Rather than recap all of this interesting analysis, let me start with the central point. There are three main approaches to stable coins. Only one works, except, it doesn’t.

The Three Approaches to Stablecoins

Non-collateralized monetary policies: Coins backed by the selling of bonds to reduce money supply when token value drops or a policy…

The crypto markets have had more than their share of drama recently, and more than their share of experts offering interpretations. Jeremy Rubin is concerned that Ethereum price will go to zero. Steven Nerayoff, an Ethereum co-creator, predicts its price will triple by the end of 2018. John McAfee thinks Bitcoin is going to moon. Jamie Dimon thinks Bitcoin is a fraud. Evgeny Chereshnev CEO of Biolink.Tech Ltd. says 90% of alt-coins are going to zero. The Winklevoss Brothers and many other want to start Crytocurrency ETFs. Ponzi scheme! Tulip craze! Wave of the future! Clearly, all these experts can’t…

John P. Conley

Professor of Economics at Vanderbilt University and Chief Economist of the GeeqChain Project - Geeq.io

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