Are we in for more turbulence in the stablecoin industry?
A week after the meltdown of USDTerra and Luna rocked the crypto world, experts say investors should pay attention to the quality of assets underlying stablecoins and the health of the ecosystem.
“It’s a completely unregulated space and people are doing all kinds of crazy experimentation, advertising things as stablecoins even though they are not,” said Frank Muci, a policy fellow at the London School of Economics and Public Policy.
“It’s these hot money movements that break these pegs essentially and any of these systems can be broken. You see that over and over again in history, not just in crypto but in the traditional financial system as well,” added Ethan Buchman, co-founder of Cosmos, an ecosystem of blockchains including Terra and Osmosis. Buchman is also the CEO of Informal Systems, a core developer of the Cosmos Network.
Watch the full Q&A interviews here: