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Due to the recent crash of Luna, people wonder what we can do to make a better stablecoin? How about finding something that is very stable? Like AriZona Iced Tea ☕? Check out USDTea!
AriZona Iced Tea has been stabilized at 99 cents since 1992. So does the tea will continue stabilizing at 99 cents in the future?
Let's see how they stabilize the product at 99 cents since 1992.
🫖 Succesful of AriZona Iced Tea
Image credit: https://www.latimes.com/business/story/2022-04-12/az-iced-tea-inflation-99-cents
The company sells about 1 billion 99-cent cans each year. The company is second to PepsiCo's Lipton, Pure Leaf, and Brisk. Lossing customers are not more detrimental than the rising price of their business. And they do not spend a load of money on commercials.
🥳 Previous champion
Not to mention that Coke Cola was the record holder to stabilize their product price for more than 70 years of their 6.5-ounce bottle at 5-cent from 1886 to 1959.
🍔 Big Mac Index
Image credit: https://medium.datadriveninvestor.com/what-do-big-mac-prices-tell-us-about-true-inflation-27f44912500f
You probably heard that Big Mac from MacDonald is an indicator of the actual inflation rate.
It is a Burgernomics.
Why not use Big Mac as a stablecoin asset backing then?
I think it is a safer bet on Big Mac than AriZona Iced Tea because Big Mac is almost everywhere globally compared to AriZona Iced Tea which is relatively stable in the very short term.
⚖️ Bad Idea of Asset-backed Currency
Image credit: https://www.moneyandbanking.com/commentary/2016/12/14/why-a-gold-standard-is-a-very-bad-idea
Anything that is backed by assets is such a bad idea! It has so many downfalls that make the market very unstable.
1️⃣ Volatile
Since there is no way to determine the true valuation of the asset, the market will be volatile for missed pricing.
2️⃣ Open to error
There will always have room for the exchange rate to missed calculated due to human errors.
3️⃣ Over supplies
Physical assets always have limited supply, but the demand can always exceed. The market was due into correction until people realized there weren't that many supplies available.
4️⃣ Illiquidity
When the market goes down, not everyone wants to redeem the backed asset. Think about USDTea. If the USDTea de-pegged, would you want to redeem 100 bottles of AriZona Iced Tea?
You may argue that it is better than nothing but the point of having a stablecoin is to stabilize the price. Right 🤣?
🧠 My thoughts
I think Big Mac makes more sense if a stablecoin wants to peg with. But it is still very unstable to use the asset-backed method.
Note: the post was shared on multiple platforms here.
You can refer my previous article lists here and here
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2022 Prediction
2022 Prediction #1: L1 Scalability
2022 Prediction #2: L2 Bridges
2022 Prediction #3: Zero-Knowledge Proofs or ZKPs
2022 Prediction #4: Regulated Defi On-Chain KYC
2022 Prediction #5: Institutional Crypto Adoption
2022 Prediction #6: Defi Insurance
2022 Prediction #7: NFTs-Based Communities - DAO 1.5
2022 Prediction #8: Metaverse and NFTs
2022 Prediction #9: Web2 Companies’ FOMO
2022 Prediction #10: Time for DAO 2.0
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DAO The Way
DAO The Way Part 1
DAO The Way Part 2
DAO The Way Part 3
DAO The Way Part 4
DAO The Way Part 5
DAO The Way Part 6
DAO The Way Part 7
DAO The Way Part 8
DAO The Way Part 9
DAO The Way Part 10
DAO The Way Part 11
DAO The Way Part 12
DAO The Way Part 13
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Learn How To Defi
Learn How To Defi Part 1
Learn How To Defi Part 2
Learn How To Defi Part 3
Learn How To Defi Part 4
Learn How To Defi Part 5
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Crypto Comics
Crypto Comics
Crypto Comics - PoW
Crypto Comics - Who is Satoshi
Crypto Comics - What is Token
Crypto Comics - What is DeFi
Crypto Comics - What is Wallet
Crypto Comics - What is HODL
Crypto Comics - What is Coinbase
Crypto Comics - What is PoS
Crypto Comics - What is DAO
Crypto Comics - What is A Block
Crypto Comics - What is NFT
Crypto Comics - What is Fork
Crypto Comics - What is Web3
Crypto Comics - What is DeFi-2
Crypto Comics - What is Yearn Finance
Crypto Comics - What is Degen
Crypto Comics - What is Aping
Crypto Comics - What is Cold Wallet
Crypto Comics - What is Hot Wallet
Crypto Comics - What is Airdrop
Crypto Comics - What is DYOR
Crypto Comics - What is 65537
Crypto Comics - What is RC4
Crypto Comics - What is WAGMI
Crypto Comics - What is Bagholder
Crypto Comics - What is Decentralization
Crypto Comics - What is Wallet Address
Crypto Comics - What is Plagiarism in Web3
Crypto Comics - What is Bart Pattern
Crypto Comics - What is Encryption
Crypto Comics - What is Consensus
Crypto Comics - What is Protocol
Crypto Comics - What is Stablecoin
Crypto Comics - What is ApeCoin
Crypto Comics - What is FOMO
Crypto Comics - What is Tokenomics
Crypto Comics - What is APR
Crypto Comics - What is to The Moon
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Learn Web3 in 100 Days
Learn Web3 in 100 Days - #1 What is the Internet and How Relevant to Web3
Learn Web3 in 100 Days - Day 2: What are the Browsers and Servers
Learn Web3 in 100 Days - Day 3: What are HTTP Status Code
Learn Web3 in 100 Days - Day 4: HTML and CSS and JS
Learn Web3 in 100 Days - Day 5: What is programming
Learn Web3 in 100 Days - Day 6: Markup, Elements, Tags, and Hyperlinks
Learn Web3 in 100 Days - Day 7: Style Your Web
Learn Web3 in 100 Days - Day 8: JS
Learn Web3 in 100 Days - Day 9: SQL
Learn Web3 in 100 Days - Day 10: Front-End
Learn Web3 in 100 Days - Day 11: Front-End Framework
Learn Web3 in 100 Days - Day 12: More HTML
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Modern Economic Nonsense
Modern Economic Nonsense - Inflation and Incentives
Modern Economical Nonsense - The Astrologist's Way
Modern Economical Nonsense - The VUCA World
Modern Economical Nonsense - Zug Tax and How to Run your Own Monopoly
Modern Economical Nonsense - Participatory Economy
Modern Economical Nonsense - Economic Models
Modern Economical Nonsense - Tokenomic Models
Modern Economical Nonsense - Design A Reputation-Based System
Modern Economical Nonsense — The Money Problem
Modern Economical Nonsense — The Treasury Problem
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Yearn Finance Comic
Yearn Finance Comic - Part 1
Yearn Finance Comic - Part 2
Yearn Finance Comic - Part 3
Yearn Finance Comic - Part 4
Yearn Finance Comic — Part 5
Yearn Finance Comic - Part 6
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Curated Lists
Curated Lists - Web3 Culture
Curated Lists - Crypto-enabled Communities
Curated Lists - Crypto Philosophy
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Defi 101
Defi 101 - Part 1
Defi 101 — Part 2
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Thoughts
Thoughts about VC and PleasrDAO x BitDAO
The Crypto Market has Changed
The Myth of Inflation Hedge
The Myth of Stablecoin
The Myth of NFT
End of the Crypto Market?
The End of the Stablecoin?
Terra-UST Saga - How to repair the trust when there is no trust built on
How to deal with negative market sentiment
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Crypto VC Thoughts
Crypto VC Thoughts: Physical Assets vs Digital Assets
Crypto VC Thoughts: Digital Money Pushes Energy Companies to Innovate
Crypto VC Thoughts: GameFi Dilemma
Crypto VC Thoughts: Credit Oceans
Crypto VC Thoughts: The Death of Terra
Crypto VC Thoughts: Debunk Bitcoin Myths
Crypto VC Thoughts: Defense Crypto Investment Methods
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Disclosure: The article was written by a delusional author who is possibly a nut job without any questions whatsoever about expertise in the subject matters. You should not believe any words this author wrote or you may experience similar symptoms or even possibly become a nut job.
