Pretty much since the moment that cryptocurrencies came into existence, there's been a chorus of skeptics who argue that they solve no real world use cases, except for gambling and speculation. For a while, there was a lot of hype about things like Web3 or DeFi, but for the most part, these still remain in the realm of pure speculation and gambling. And so, the ultimate use case for crypto remains elusive. Our guest on this episode argues otherwise. He thinks that stablecoins, such as Circle or Paxos, which are backed by actual dollar instruments in regulated institutions running on public blockchains (like Ethereum or Solana) are solving a genuine problem in transmitting money, beyond just speculating on other cryptocurrencies. Austin Campbell is an adjunct professor at Columbia Business School and the founder of Zero Knowledge Consulting. He also comes with a long resume at both crypto and legacy financial institutions. He explains why stablecoins are having a moment and explains the problems they currently solve (particularly internationally) and why legacy payments infrastructure is unlikely to serve the same needs.

Read more:
The Case for Stablecoins Being the New Shadow Banks (https://bloom.bg/4dNFa0s)

How Stablecoins Became a Powerful Force in Crypto (https://bloom.bg/3B1ySf6)

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Key insight from the pod:
Intro -- 0:00
What is a stablecoin? — 7:33
How a stablecoin payment differs from a traditional money transfer — 10:27
Signs that stablecoins aren’t just being used for speculation — 11:38
How stablecoins hold their value — 13:34
Where do stablecoins hold their money? — 14:50
Why do we need public blockchains to trade stablecoins? — 18:28
Why can’t banks just improve existing payment systems? — 19:41
The downsides of stablecoin use — 21:11
Who gets to regulate stablecoins? — 25:01
What happens when a stablecoin depegs from the dollar? — 27:47
Will the network tokens accrue value from stablecoin usage? — 30:57
Can banks launch their own competitors? — 32:11
The challenge of existing regulations — 34:07
Could banks launch their own semi-public blockchains? — 37:18
Are governments internationally scared about stablecoins? — 40:55
What do crypto people get wrong about legacy finance? — 44:50

Bloomberg's Joe Weisenthal and Tracy Alloway analyze the weird patterns, the complex issues and the newest market crazes. Join the conversation every Monday and Thursday for interviews with the most interesting minds in finance, economics and markets.

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