^ this is a common security misconception in crypto. "We're using an HSM, they can't steal our private key." OK genius now you still have to secure the HSM.
There's no shortcut to MPC/multisig with 3+ keyholders.
> There's no shortcut to MPC/multisig with 3+ keyholders.
The whole concept of a stablecoin seems to be based on centralised trust.
Ultimately there is some org that has the fiat bank account, that mints and redeems the coins.
Nope, that is the foundation of bad stablecoin. Trustless decentralized stablecoin like DAI exist. People just largely don't do their homework and prefer scams that lure them in with promises of 'yield'
DAI and SKY are backed in large part by USDC, so they are not truly decentralized. It is possible in theory, but nobody has successfully done it so far.
It's possible in practice: that's how DAI worked originally. It's just not very competitive where the main customer -- traders -- want a lot of liquidity and razor thin spread.
DAI made some dumb decisions for market reasons recently but it was an actual stablecoin for a long time. It worked fine, they just decided to make it worse for some reason.