Editor's Note: This article comes fromCrypto Valley Live (ID: cryptovalley)Editor's Note: This article comes from

Crypto Valley Live (ID: cryptovalley)

Crypto Valley Live (ID: cryptovalley)

, Author: Sir John Hargrave, translation: Ziming, reproduced by Odaily with authorization.

“Proceed as if success is inevitable.” I use this proverb a lot when talking about the blockchain industry. "Inevitable" is one of my favorite words, because in my opinion, in the Internet age, the arrival of blockchain is inevitable.

“Without involving BTC and Libra, I think stablecoins do have real advantages. It’s hard for us to use a Token whose price is constantly fluctuating. For example, when we go to Starbucks, we don’t even know how much we should use that day. Token! It is clear that, over time, stablecoins will have a long-term advantage in the face of the above.

This is just my opinion, representing only a few people. But in my personal opinion, central banks around the world need to seriously consider the issuance of central bank stablecoins.

I think it's inevitable. Because we will not stop the pace of technological progress, and this issue should be thought about now. "

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Why Stablecoins Are Needed: Reason One

The process of interchanging between "traditional" currencies (such as USD) and "digital" currencies (such as BTC) is still very slow and expensive.

People often ask, "If we're going to create a new digital currency, why peg it to an existing currency like the U.S. dollar? Why not just use the U.S. dollar?"

The first reason: the process of converting money from fiat to digital is slow and expensive. Here we have a real case study on the boom of the stablecoin Tether (USDT) in China.

What the vast majority of Chinese digital currency traders do is store value in stablecoins. As CoinDesk reported, USDT trading volumes surged to record highs led by Chinese traders, not just fringe adopters but early evangelists. So, in a sense, Harker’s prediction that stablecoins are “inevitable” is actually an understatement, because they’re already here with us.

Traders are always on the cusp of economic developments, and that cusp can often be a harbinger of things to come. As more money managers incorporate digital assets into their investment portfolios, a stablecoin like USDT will not only be an interesting innovation, but "it should be a legitimate thing in its own right." And this seems inevitable.

“One money for one world.”

In short, exchanging funds between fiat and digital currencies is slow and expensive. Stablecoins offer a way to hold value that is cheaper and easier than the aforementioned back and forth.

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Why Stablecoins Are Needed: Reason Two

Despite all the rhetoric in politics today, most of us can understand that we live in a global economy. What affects one country affects all countries in one way or another.

This is why economies are so unpredictable: every country's economy affects every other country's economy. It's like a science experiment with 200 different variables, all of which are constantly echoing and reverberating with each other like raindrops falling on the smooth surface of a pond.

Sometimes someone throws a stone into the pond (trade war) and the next thing we can see its impact in the world economy. We must keep this in mind: we are looking at a mental model of the global economy (a pond), not a series of interconnected micro-economies (independent puddles).

In this view, why do we need different kinds of money? In fact, it is no exaggeration to say that money is moving around the globe at the speed of light. The exchange of currencies between euros, dollars and renminbi is a historical practice before the advent of the Internet. Back then, we had to communicate by telegraph, and sailed across the oceans on ships, with men wearing bowler hats and women with parasols.

In the words of Patrick Harker:

“You see, even though the vast majority of money in the world is digital, it’s still central bank money, so it’s not a big leap. The difference, however, is the approach to creating this stablecoin. Again, I'm not sure how to do it, and I'm not sure when it will be done. But at least we should start thinking about it seriously."

I really think I should be paid for his great talk, and it will definitely be in the form of stablecoins.

We live in a global economy and every event affects us all.

Now we need stablecoins more than ever, because we need a Token that applies to the world; we need a Token that applies to all mankind; we need a Token that applies to the global economy.

If we used beads and stones instead of dollars and euros, we could easily see the inefficiency of our system. Our current system is like beads and stones. We need a global standard that applies to all nations: a "global currency" for the people of the planet.

A unified stablecoin standard will further open up trade, provide access to the unbanked, and usher in a new era of prosperity and wealth. With a blockchain-based Earth Currency, we can create one digital currency for everyone, everywhere, and we all benefit from it.

In short, a stable global digital currency that makes moving money simpler and easier will help our global economy thrive.

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snowball effect

But Harker did not call on the United States to take the lead in doing this. Here, the culture of banking and finance meets the culture of technology in an odd combination.

I often describe blockchain as a Venn diagram where finance (suits) meets technology (hoodies), and few people understand both worlds at the same time. The blockchain is the intersection of this Venn diagram.

It is rare for a top company in the technology field to leave a second seat for other companies. For example, if you have the speed and vision of Microsoft, then you can lead the PC software revolution; similarly, if you have the speed and vision of Google, you will lead the information revolution; if you have the speed and vision of Uber, then You will lead the ride-sharing revolution.

In tech, if you wait for someone else to lead technology (perhaps because you're hesitant or unsure), you can't be number one. This is because technology has network effects. Simply put, it snowballs up early until it gets too heavy and too fast to stop.

Blockchain also has network effects. China is preparing to launch its own digital currency, which will make it easier to convert between fiat and digital currencies, which may appeal to all Tether users. Of all the major economic powers, China will likely achieve this snowball effect.

Once China participates in this digital currency game, other major economic powers will inevitably follow in China's footsteps. Because China started first, China will be the leader in this field due to the snowball effect.

From then on it seemed inevitable that every country would rush to mint its own blockchain based digital currency but it would be like everyone just realized the value of the internet in the 2000s because you couldn't afford it The price of exclusion. But that's still just the beginning, because we want a global blockchain standard.