Be careful what you wish for with crypto
The thing about an unregulated free market is that it can be impossible to know what it will do. You can model it all you like, using all the best predictors, but its still going to move in its own direction, driven by the will of its participants.
Such is the case with the evolution of the crypto space.
When the individual that was identified as Satoshi Nakamoto first conceived of Bitcoin back in 2009 he wanted to create a disruptive currency that wasn’t tethered to the traditional banking mechanisms. He simply didn’t trust those institutions, who he felt were ripping off regular people with unnecessary and punitive fees.
At the time he wrote “The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.”
No one can know for sure what exactly he envisioned Bitcoin and the crypto space to look like in in 12 years, but it’s hard to imagine he would have exactly seen what we have today.
The value of the coin, sure. That he’d be excited about. But, as crypto drives to more and more legitimacy, is it going to continue to operate as an alternative to traditional fiat exchanges, or will it evolve into an extension of them?
If it’s the latter, is that any better than what we had back in 2009?
USD Coin is tethered to USD and, as such, is really not operating beyond the control and whims of the United States treasury department. Its value will ebb and flow at the exact same rate at the U.S. dollar.
So, Visa wasn’t really accepting crypto as payment, so much as it was recognizing the value of blockchain to protect and trace the exchange of funds. That is progress, but it’s not as revolutionary as the excited headlines announcing Visa’s policy change would make it out to be.
You’re still going to pay Visa those fees that Satoshi Nakamoto was looking to get around, you’re just going to pay them with stablecoin instead of a fait currency. I doubt that is going to make him trust Visa anymore today than he would have all those years ago.
However, that might not matter. As implied off the top of the article, it’s the free market that is driving this evolution. As crypto moves further away from the early adopter stage and more “regular” people start to invest in it the demand for liquidity will intensify.
Most of us need to be able to easily use our money on a day-to-day basis and that lack of pragmatism is still a weakness of the space. Stablecoin becomes a necessary evil in that evolution from the theoretical to the practical.
The key for early adopters and true believers of crypto is to not lose control of the space as increasingly more traditional financial service players get into the game.