The adoption rate of digital currencies has been a problem heard around the world since its conception, even for more famous coins like BTC or ETH. But new use cases emerge daily, and the trend is picking up rapid steam in providing more token holders to not just buy and trade, but also to use in their everyday lives. This trend is mirrored in the stablecoin space, here are 5 real things you can do with stablecoins, today!
1. Invest & Hedge
This is probably the most simple and straightforward use case of stablecoins today. Due to their relatively “stable” valuation by being pegged either to a fiat currency, or a series of assets both digital and physical, stablecoins offer investors more confidence due to lower volatility. This allows investors a simple way to hedge (or get a safety net) against bets that tend to be more risky. Even the best investors in the world will tell you that a stable diversity of investment is important as a hedge, because the market is unpredictable — but having investments on both sides can prevent you from suffering a catastrophic loss. As a result, we have seen a large amount of traditional venture capital being poured into the space. Having said that, investing in stablecoins is still in the early stages and caution should be exercised as not all projects are created equal.
2. Buy Cryptocurrency
If you want to really dive into the world of cryptocurrency these days, you will need a medium of exchange that makes it relatively easy for you to trade digital currencies back and forth. Unfortunately, due to the incredible volatility of certain coins including Bitcoin (BTC) and Ether (ETH), most centralized institutions like banks do not offer a direct method for you to convert your USD into BTC. Another added benefit to stablecoins in this regard is that it acts as a counter float against the trend in Bitcoin, since altcoins have a tendency to follow the spiraling shifts of Bitcoin’s valuation. By using stablecoins, traders now have a more stable medium of exchange since it is often pegged to fiat currencies, ensuring their value in the digital space despite the fluctuations of other coins. This is exemplified by one of the largest stablecoins on the market today, Tether — as it is used in an estimated 80% of all crypto trading.
A key advantage to stablecoins is that they provide much, if not all of the benefits of digital currencies while providing the ease of mind that fiat currencies give. One of the benefits is being able to participate in the governance of blockchain related projects, including many up and coming DeFi (decentralized finance) ones. By any standards, digital tokens give the token holders a right to participate in community-based actions such as voting or receiving rewards. Since the nature of blockchain is decentralization, stablecoins offer its holders access to participate in the governance of a truly decentralized community.
4. Global Remittance
Once again, this is a key advantage of the crypto currency space — especially as more 3rd party providers are emerging with a range of services. In the old days, you’d have to convert your USD to EUR if you were travelling through Italy, with all service providers charging you EUR along the way. We have now simply accepted this as a “cost” for travelling, but blockchain and digital currencies can completely upend this habit. With stablecoins, you can in theory directly pay vendors in a “token,” and have them convert it to their local currency without you having to deal with transaction or exchange fees. This can potentially give you remittance both when you are travelling physically, but also when you are making digital transactions online. If we take a larger step back, it is difficult to argue with the trend that is shaping our world today where goods, services, and other transactions are increasingly relying on a form of remittance — paving the way for stablecoins to be used as a primary source of currency.
5. Gift Giving
Now, we all know giving the right gift can be tricky, especially if you aren’t 100% sure what the person wants, needs, or already has. This problem is solved with stablecoins because most everyone loves receiving cash — or money, as a gift. What is cool about giving stablecoins as gifts is that the value will likely increase over time, not in a fiscal way but rather in opportunities for usage as the service providers and ecosystems grow over time. Who knows, maybe this can be an entry point for your friend to get involved more in the blockchain space — it is what we see as the future, after all.
In conclusion, there are currently an increasing number of ways to use stablecoins in your everyday life. As the whole industry grows and matures, we are sure that more and more methods of transaction will pop up! Who knows, maybe you can even buy ice cream at your local dispensary with it — wouldn’t that be sweet? If we missed any use cases, or if you have better ideas, let us know!
Stably is a US-based FinTech providing fiat onramp and stablecoin infrastructure to digital wallets, decentralized applications, Web3 projects, and blockchain development organizations. Our mission is to power the next billion Web3 users with a superior fiat <> crypto onramp to all popular and emerging blockchain ecosystems.
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