Brian Armstrong flags potential for inflation-linked stablecoins

“Stablecoins” that adjust their nominal value in line with the Consumer Price Index may gain popularity. This was stated by Coinbase CEO Brian Armstrong, writes BeInCrypto.

During AMA-session, the executive forecasted growth in the number of such assets.

“Over time we may see stablecoins that resemble fiat currencies more closely. They will move in tandem with purchasing power, pegged to the CPI […]. Put simply, if today you can buy a hamburger at McDonald’s with such a token, you should be able to buy that hamburger with it in five years”, Armstrong explained.

The head of Coinbase assured that the platform would strive to balance access to trading of digital assets — not to implement a strict filter, but to carefully take regulatory requirements in countries where it operates into account. The company will adhere to certain listing standards, and will rigorously assess cybersecurity and the quality of smart contracts, he added.

“Any shortcomings in these areas could expose the exchange’s clients to losses of funds”, he explained.

Brian Armstrong pledged to integrate the exchange’s offerings into products of major companies that will allow “investing directly in crypto assets,” following the recent agreement with BlackRock. The initiative aims to boost economic freedom, as well as control over one’s funds and investments, he explained.

Earlier Armstrong said that the platform is cutting costs and shifting its focus to additional services in a crypto-winter environment.

As reported, Coinbase’s net loss in the second quarter of 2022 amounted to $1.1 billion, more than double analysts’ expectations. Net revenue in April–June fell from $2.03 billion to $803 million. Trading commissions accounted for 82% of net revenue.

In August, S&P Global downgraded the exchange’s corporate rating from “BB+” to “BB,” while keeping a negative outlook.

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