Anchor Featured as the Stablecoin that Helps Economic Stability
The Oofy has recently published an attention-grabbing article on the future of stablecoins, cryptocurrencies and fiat-based economy called: “Stablecoins Trending: How Stablecoins Can Affect the Economic Stability on Both Crypto and Fiat Scene.”
The piece addresses the veil of doubt – or crypto winter, as they referred to it – that is currently surrounding the cryptocurrency and blockchain landscape. This crypto winter occurred due to recent fluctuation in value and a rather volatile stability of Bitcoin and Tether, two most popular and widely spread crypto tokens, which is why the team behind this Oofy article tackles the ever-so-present question:
Are stablecoins truly the answer and can they really bring the much coveted stability and trust to the currently trust-shaken cryptocurrency scene?
The main and seemingly insurmountable problem with regular cryptocurrencies is their backing mechanism, or lack thereof. Most crypto tokens peg their value to either fiat money (like USD or EUR), other cryptos, or commodities like Gold, which has proven countless times as a major pain point for maintaining consistent value of a crypto token. Inflation is still an inevitable problem and the repercussions of the destabilization of fiat money are quite evident, especially over the last 30 years or so. The best example is the US dollar which depreciated almost 50% in value during the said period.
A stablecoin like Anchor, on the other hand, offers an elegant solution that features a backing mechanism based on a proprietary algorithm and world GDP through which the financial data necessary for this pegging model to work is being gathered and calculated from over 190 of world countries, with the focus on 20 most pertinent ones.
To find out more about stablecoins, Anchor, and why current cryptos are not a viable solution to volatility and instability – read this entire HERE.
Title photo by Sharon McCutcheon, Unsplash.