co-founder, Charles Hoskinson, in a recent YouTube stream on the 13th of February, highlighted how legacy financial institutions encroaching on crypto may compromise its fundamental ethos.
As critical concerns in the crypto space continue to mount, asset-backed stablecoins have asserted dominance in the market, often overlooked by mainstream cryptocurrency enthusiasts.While addressing the dominance and centralized nature of asset-backed stablecoins, Hoskinson emphasized, “Asset-backed stablecoins have two properties: a central issuer subject to regulation and cannot go fractional.”Charles Hoskinson juxtaposed this with algorithmic stablecoins, arguing that they aligned better with the decentralized ethos of cryptocurrency. He highlighted,Algorithmic stablecoins are governed by on-chain algorithms that are free from the influence of a central authority that could skew outcomes in their favor.
Thus, if cryptocurrencies lose their decentralized nature, they might start looking exactly like the traditional financial systems they initially aimed to change.Ishika is a graduate of Political Science from the University of Delhi. From writing content as a hobby to now pursuing it as a professional career, she has been living and breathing content all her life. Her interests lie in making sure articles are very digestible to a common reader, despite all its technicalities and jargons.