[lilactown]

The difference is that it's not "fools" that will accept USD, but people who are taxed by the US government. That's what keeps the USD from being worth nothing; even if you do all your transactions in crypto (which you shouldn't), you need to convert it to USD at some point to pay your taxes.

This is why actual currency and cryptocoins are not equivalent; there's no one forcing someone to eventually convert into cryptocoins, so the value of any individual coin can go quickly to 0 based purely on whims - or someone rug pulls and freezes sales, making off with all the money from people who have bought in.

In order for the USD to go to 0, the US Government would have to collapse. We might argue about how likely that is, but I think we can all agree that it's less likely than a cryptocoin staying at the top of the hype cycle.

Another difference between cryptocoins and currency is the deflationary nature of cryptocoins, which encourages holding, which (if used as a currency) slows the velocity of money in the system, which leads to all sorts of macroeconomic problems like shortages - because no one wants to buy things, people stop making things.

Stablecoins and every other crypto scheme are just speed running the lessons the financial crashes should have taught us over the last 20 years. It shows there's a large swathe of people who saw the crash and thought that they want to be the ones who get rich and then bailed out, rather than preventing them from happening in the first place.

[krick]

This is only partially true. Yes, USD is sort of backed by the fact there are people with guns extorting taxes from you in USD. Except, if you earn no USD, you shall pay no USD. And if "fools" stop believing anybody will sell you any food for USD tomorrow (because there is a civil war and USA is no more for all practivcal purposes) then USD is worth pretty much nothing, whether you are still required (legally) to pay taxes or not. Reality is stronger than the government laws, always.

So, nope. All this "backed by USA economy" bullshit is just fancy way of saying "backed by nothing". If people don't believe USD is worth anything, it is worth nothing. If people believe BTC is worth a ton of bananas on Marrakech market, it costs approximately as much as whatever a ton of bananas costs in any other currency. Now why people believe that — because there are people with guns extorting the taxes, or for some other reason — is another story.

I.e., all money exists only because people believe it exists and works as supposed.

Anyway, as I've said already, this isn't the point. Everything I've said above I had to say in order to reply, but I don't want to discuss that, it's irrelevant. Stablecoins aren't supposed to be something you believe in or not. They are supposed to just work reliably as long as people believe some other non-fiat currency works. At least, they are promised to do that (and we are discussing if this promise may be any true). I.e., DAI will obviously be worth nothing if ETH is completely forbidden (and that is enforced), so it stops being exchanged anywhere, so then ETH is worth nothing, and DAI is also worth nothing. This is ok, that isn't something stablecoins are promised to magically counter. They are promised, however, to magically maintain their peg, and if that promise is any true is what we are discussing (at least, that's the premise of Buterin's post).

So, to reiterate once more, the question being discussed isn't whether you believe in BTC/ETH/LUNA/DAI/UST/USD/gold. The question is whether if DAI/UST can maintain its peg to 1 USD under the assumption ETH/LUNA isn't totally worthless. This is the only thing that matters for the discussion. The rest is completely irrelevant.

(To be completely fair, it still can end up with the conclusion that you don't believe in the currency on which a stablecoin is based. For me, the mere fact that the whole LUNA's existence was basically justified by UST should've raised some questions about its sustainability. But it's still about "what must happen in order for UST to lose its peg", and not some quasi-philosophical discussions on whether money — be it BTC or USD or even gold — is real.)

[josephcsible]

> Except, if you earn no USD, you shall pay no USD.

I thought that you do have to pay taxes in USD even if your earnings were in something else.

[trompetenaccoun]

It's hard to imagine but there are people who aren't American ;)

Btw, while the tax argument was the last thread the fiat fans were clinging to, it should be noted that this is obsolete now since there's at least one country where you can already pay tax with cryptocurrency and possibly a second one that recently introduced Bitcoin as legal tender. As well as the Próspera SEZ in Honduras. Things have been moving fast, it's highly unlikely that this trend can be stopped now, even if some countries aren't going to accept it any time soon.

[krick]

Of course you have to (or, well, obviously it depends on the laws of your country, but let's be real — what country would agree that you don't?). But there's no earnings, if all your earnings are in magical Warhammer 5000 Gold™ that your government doesn't recognize as money.

(Of course, to be fair, income tax isn't the only tax you are supposed to pay, so I'm vastly oversimplifying everything here, but, again, I'm doing so because all of this isn't the point.)