Co-founder of Bitmex Arthur Hayes says that Circle’s Successful Initial Public Offer (IPO) has inflamed the following large bubble in the cryptomarkt.
In a new blog post, Hayes warns that Circle’s stock exchange debut has marked the start of a “stablecoin mania” that he thinks will fleecen who get entangled in the hype.
According to the Crypto veteran, the success of Circle will inspire a wave of new stablecoin -mittenten who want to take advantage of the hype and lure investors with enormous growth.
“The bubble will pop up after the launch of a Stablecoin emittent on a public market, most likely in the US, which fools separates from dozens of billions of capital by using a combination of financial engineering, leverage and amazing showmanship …
A very bankable charismatic individual comes on stage and spits all kinds of nonsense, swings with his (most likely a male) hands to and forth, and you convince why the leverage he sells, about to combine the multi-trillion dollar totally addressable market (tame) (tame). “
Hayes notes that the extent of the damage due to the threatening Stablecoin mania will largely depend on how the US chooses to regulate the sector.
“The more freedom is permitted to issuers in terms of what a stablecoin supports and whether they can deliver to holders, the more financial engineering and leverage that can be used to mask on*rd. If you assume that a light stablatory regulatory regulatory regulatory PONANITICY OF CANTICY Proceeds come from the application of leverage on some assets.
In 2022, the Terra -Ecosystem collapsed after its algorithmic Stablecoin Luna lost its PEG to the dollar, so that $ 40 billion in market value was wiped out.
For those who want to invest in other Stablecoin emission, Hayes says to keep a close eye on the distribution channels of the project.
“Als je hier stopt met lezen, is de enige vraag die je jezelf moet stellen bij het evalueren van een investering in een Stablecoin -emittent, is dit: hoe zullen ze hun product verspreiden? Om op schaal te distribueren, en daarmee bedoel ik de mogelijkheid om miljoenen gebruikers te bereiken, een emittent moet de pijpen van een crypto -beurs, een web2 sociale media -goliat, of een legacy -bank bereiken. Als ze geen distributie to have.
And if you cannot easily verify that this issuer has access to push a product through one or more of these channels, run away! ”
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Featured image: Shutterstock/Keremgogus/Vladimir Sazonov