Black Wednesday or PUMP&DUMP story.
On the 16th September morning in 1992, British currency became cheaper harshly. Like the London bombing, a wave of sales swept through the market, making the finance minister nervous. To avoid complete destruction of the financial system, the Ministry of Finance decides to urgently raise the discount rate from 10% to 12%, but this did not help. After the opening of the American stock exchanges, a new wave of sales began, and the rate is already raised to 15%. However, even with the participation of central banks of other countries, the fall was already unstoppable – some unknown sellers threw pounds sterling in huge quantities.
A small historical example tells how J. Soros put a whole country on knees and became rich on it. But this is a story about a classic economy.
How to be investors in the digital world?
The digital economic space is only evolving, and here the full expanse for the new “Soros” – the term “pump and dump” plays with new colors. Bitcoin, Ether, Altcoins are all unstable.
YOU ARE NOT PROTECTED AGAINST MARKET RISK
Your losses can be significant. This problem has allowed the ecosystem to make a qualitative leap. Now we have a stablecoin, a defensive asset that is not subjected to the PUMP & DUMP strategy. Here is what one public figure says about stablebcoins:
«Stablecoins are important in the same way that a bridge is important. You may not care much about the bridge, but without it, the beautiful land beyond is much harder to get to», – Eric Voorhees.
Stablecoin is the bridge to hedge, low commissions and legality.
On the stock exchanges there is a tendency to decrease the share of fiat&crypto operations and increase the share of stablecoin&crypto operations. This is beneficial to all traders, because it eliminates unnecessary banking transactions, as a result, the commissions are reduced, the speed increases. For the active user, this primarily means being able to exit the cache cheaply. To clarify the situation, let’s follow an example:
|Fiat & Crypto||Stablecoin & Crypto|
|Number of trades||4 trades||4 trades|
|One trade commission||3,5% – buy
3,5% – close
|0,05% – buy
0,05% – close
The example is conditional, but visual: If cryptocurrency markets are in a fever, then you need to take profits. The cost of exit without Stablecoins takes most of the accumulated profits.
Consequence: the use of stable cryptocurrency makes it possible to reduce the market and operational risk to almost zero.
What other advantages does the use of stable cryptocurrency give?
By providing each token with real currency, the digital asset acts as a unique means of payment, while at the same time avoiding bank red tape.
Which cryptocurrency is worth to choose?
The most popular is currently considered Tether (USDT), TrueUSD (TUSD), USD Coin (USDC), Stasis (EURS). The list of stable cryptocurrencies is actually much more, if you are interested in learning more about this phenomenon in our website there is a series of articles dedicated to stable cryptocurrencies.
One of the worthy solutions for a modern crypto investor will be the company’s offer from the Raido Finance.
Stablecoin Bridge – an ability to purchase and sale stablecoins for the fiat currency on the Raido Finance platform. User can store funds without currency risk to stablecoin currency (for example EUR), can buy/sell the cryptocurrency, make transfers.
For people from the European countries, the most comfortable currency is the €. That is why the company gives preference to the Stasis project EURS. EURS is a stable currency, supported by euro. Stasis was officially registered in Malta in April 2018, with a total of 30.9 million issued euro coins.
All transactions goes through SEPA – instant bank transfer in EUR. When you buy EURS, you make SEPA (EUR) – transfer to the details of the Raido Finance. In time of selling EURS, you must have enough EURS on your balance sheet and after filling in your bank details, an operation can be performed.