A former federal prosecutor Kathryn Haun has said that Stablecoins are key in reducing volatility in the cryptocurrency industry. She stated this in a recent debate with a Nobel Prize Winner in Economics Paul Krugman on the intrinsic value of Bitcoin and other cryptocurrencies.
She spoke about the volatility of Bitcoin after ten years of its invention, saying the volatility is reducing but stablecoins will play an important role in reducing it.
“I think now what we’re seeing is the price volatility is lessening and I grant you there’s still a lot of volatility I think things like stable coins are really interesting and really important to this ecosystem to hedge against that volatility.”
Following Krugman’s comparison of Bitcoin to the internet, Kathryn said that Bitcoin was believed to have no intrinsic value, it would not have had any value 10 years ago when it came in to existence.
Krugman expressed surprised at the immense importance of the internet in day to day living which he had underestimated. He further stated that the potential for wide application the internet had in its early years is missing in cryptocurrencies today.
He also added that considering the fact that bitcoin has existed for ten years, it has not being used significantly as a means of payment, saying Bitcoin transaction volume is significantly lower than the USD foreign market exchange alone.
“We can tell the dollar value of Bitcoin transactions peaked at the beginning of this year and that’s actually fallen substantially since then. There’s very little sign that it is becoming any kind of widespread means of payments and that’s ten years on. So when is that going to happen?”
Kathryn also mentioned during the debate that bitcoin was not fulfilling the vision of its creator Satoshi Nakamoto, as a peer-to-peer electronic payment system, adding that Bitcoin Cash is fulfilling the vision more.
“[…] its main use is certainly not that. However, Bitcoin Cash is trying to do that. The reason Bitcoin is been held back aside from volatility is the scaling. And right now, you have things like the Lightning Network, which are being built and Lighting Network is aiming to increase the ability to use Bitcoin for payments”
She further said Bitcoin may never be used for payments but some other cryptocurrencies may. She also said Bitcoin was noticed by both government and private institutions which considered Bitcoin as a mechanism for criminal activities. This may be responsible for its little use as a payment system.
Featured Image by: Shutterstock