[quickthrower2]

With stable coins you can have insolvency which is worse than a bank run probably (because no government insurance). Stable coins are the worse to keep cash - higher risk than a bank account but no interest. The only logical uses for them is online gambling and money laundering.

You don’t own a USDC. Instead some random offshore company owes you a dollar.

[jejeyyy77]

How can a stable coin be insolvent if they have proof of reserves showing they have assets that match total deposit value?

[hd95489]

Same way you did with svb. A stable coin is basically a bank. They take in assets and generate tokens against them. If there is a mass withdrawal they would need to sell assets possibly at a loss to cover it. If they a duration mismatch then they eat the losses come withdrawal time. Go too fast and they depeg and boom

[quickthrower2]

1. Do they post daily proof of reserves?

2. Are their bank accounts locked down to strictly the blockchain activity?

Proof of reserves means everyone was safe yesterday, at best.