The Paypal stablecoin backed by dollars and securities smacks to us a disaster in the making. As Terra and other forays into this space have clearly shown thru the years, the BACKING for the issuance of these currencies is key to success and herein lies the rub.

Written by Michael E Dehn

Founder and CEO of Metro Pulse a continually running enterprise since May 1980.

August 21, 2023

Derivatures operate in a similar fashion in regards to their valuations being based on opaque underlying assets. We are VERY uneasy with this development as to us it TRUMPS the official issuance of the US government CBDC and is detrimental to the overall economy in it’s application.

With the incredible pressure on banks between the explosive rise in interest rates affecting the value of their bond portfolios and commercial real estate exposures that seem to be plummeting by the day, the current play by the SEC this weekend in abruptly reversing their legal position on possibly relenting in issuing securities asset approval for public use is telling.

To us it strongly suggests the FED has a real fear that the line up of monster financial firms queuing for asset custodian licenses for an approved public crypto that has eluded everyone to this point may potentially cripple a teetering system in outflows of dollars to those decentralized out of their control systems. It has been reported that bank deposits in the major banks have diminished over the last 2 years by the hundreds of billions of dollars so time will tell what that play ultimately will be.

And a friend reported to us that just this morning 8/21 his premium digital Chase business account was shut down till he signed off on a 10 page and 125 page disclaimer. Given no notice and on a MAJOR business day as well it was a MAJOR imposition on his time as the efficiency of the digital app was key to him using the account.

But why would Chase FORCE such a draconian measure on a good account with no notice? And what could possibly be in a 125 page disclaimer not already covered in existing agreements prior?

And who has the time to read a 125 page “release” without a lawyer? Nothing but ominous here.

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Says volumes eh?

Agreed 100%