APRIL 21, 2020, ZUG, SWITZERLAND - A crowd of almost 500 engaged cryptocurrency community members from more than 50 different countries, came together last Friday to celebrate the first-ever exchange of ideas on the topic of stablecoins via a digital medium.  The event’s theme “Stablecoins: Before and After COVID - 19” was planned and hosted by the Crypto Valley Association. This was the Association’s inaugural online event and was filled with representatives from cryptocurrency organizations, industry experts, and financial technology enthusiasts. 

The event hosted by Emi Lorincz, Chair Crypto Valley - Western Chapter / Director Sales Ledger Vault and featured eight speakers from Binance, Dukascopy Bank, Sygnum, Mt. Pelerin, Maker Foundation, YouHodler, and the Crypto Valley Association who each had speeches as well as a panel discussion centered around stablecoin use cases, risks, and benefits for the future. Given that the Financial Stability Board (FSB) released a strong report just days before this event, many attendees were intrigued about the life of stablecoins and were eager for answers from the speakers.

The first speaker of the event was Josh Goodbody, a representative from the leading exchange Binance. Goodbody instantly listed the many benefits of Binance stablecoin (BUSD) and many others such as affordable global payments, protection from volatility and cheap transactions. Yet, as we start to see our economy evolve due to the COVID-19 economic crisis, Goodbody claims he definitely sees a world where stablecoins are not extinct, but alive and holding a central role in global governments as fiat currencies attempt to recover from hyperinflation. He stated government stablecoin airdrops and central bank-backed stablecoins could very well become real outcomes in the coming years. 

Following Binance was  Gustav Arentoft from the Maker Foundation. Arentoft also highlighted the positive benefits of Maker’s stablecoin DAI (the most dominant decentralized stablecoin in the industry). In the past, DAI was used to facilitate quick, frictionless cross-border payments for disaster relief funds in the pacific which has translated nicely to the current COVID-19 crisis. DAI donations are currently being sent to an organization of the Philippines to help with the ongoing virus complications in the region further highlighting the staying power of stablecoins and their rising popularity on a global scale. 

During the event, representatives of the banking industry -  Martin Burgherr,  Chief Clients Officer of Sygnum and Alexander Suhobokov, Head of Fintech at Dukascopy Bank presented their regulated stablecoins: the first banking CHF-backed stablecoin from Sygnum and the concept of multi-currency stable coins from Dukascopy Bank. 

The next part of the event was to discuss how these stablecoin use cases will translate to a potentially damaged economy post-COVID-19. With governments pumping incredibly large sums of money into the economy, many are worried about the possibility of hyperinflation on a global scale. To combat this volatility, Ilya Volkov YouHodler CEO theorized: “stablecoins backed by gold (like PAXG) will rise in popularity (and value) as investors look for safe, stable havens outside of traditional markets. These stablecoins have all the benefits of cryptocurrency (privacy, convenience, low transaction fees, fast transaction times, transparency, etc) with the added bonus of stability. Stablecoins are also a major component of the Crypto Carry Trade Strategy. A strategy that involves trading fiat for stablecoins and then benefiting from high-yield stablecoin savings accounts. Stablecoins will not evaporate as time goes but instead, I truly believe stablecoins are a key element for post-pandemic economic evolution.”

The event was well-timed around the announcement of the Financial Stability Board’s (FSB) investigation into stablecoins and how they can be regulated for the future.  In the report, the FSB made several suggestions on how to improve liquidity risk, default risk, market risk, and foreign exchange risk in order for a healthier digital economy. “To assist with this evolutionary step, the Crypto Valley Association is forming a Stablecoins Task Force within the Regulatory Group of the CVA. One of the objectives of this  will be to issue dedicated analysis within the Working Group that considers the specifics related to stablecoins: one voice when taking a position and promoting stablecoins for the industry towards stakeholders. This is what will be aimed this upcoming weeks when providing the FSB with an official position.” said Biba Homsy, CVA Chair of Regulatory Working Group.

Finally, event attendees were treated to an extra hour of digital networking sessions where eager participants joined ten different rooms to interact with industry experts to discuss the promising future for stablecoins. “This was the first time we have ever had an online event with digital networking” said CVA Executive Director Jérôme Bailly. “Networking is the most important part of any conference so we felt the need to replicate this somehow. We came up with a unique solution that featured ten different virtual rooms, all with unique themes and topics for discussion. These rooms were incredibly inspiring. I witnessed industry experts having deep discussions with community members on the potential of stablecoins in this new economy we are witnessing evolve before our very eyes.”

Given the complex nature and overall modernity of this stablecoin topic, there were obviously many questions from the audience during the live Q&A and the networking sessions. In order to continue discussion attendees are welcome to join the Crypto Valley Association Portal: https://members.cryptovalley.swiss/topics/17846/feed.

About the Crypto Valley Association

The CVA is an independent nonprofit association located in Switzerland. Our mission is to build the world’s leading ecosystem for blockchain and cryptographic technologies in Switzerland and beyond. Our main focus is on developing and executing a community-driven program targeted at establishing and growing the ecosystem. This includes supporting start-ups and established businesses, making policy recommendations, initiating research projects, and hosting conferences, hackathons, and other industry events. We are also working to be a bridge between Crypto Valley and the global cryptographic technologies community – building on our already active connections to international centers of blockchain innovation in London, Singapore, Seoul, Silicon Valley, and New York.