Why would I tie my future wealth to the US dollar?

[Curiousbut]

Hi,

I am genuinely curious as the the reasons for pegging Nubits to the US dollar. Why not the British pound, that was the world’s reserve currency 100 years ago?

Sure, right now, the USD is the world’s reserve currency, however the US is actively trying to devalue the dollar to ensure it’s exports are competitive.

Why would you peg your currency that the world’s superpower stated goal is to devalue?

Is fixing an exchange rate the only way to stabilise the value of a currency? Why not fix it to a basket of currencies and manage the weightings in the basket? Or a basket of currencies and commodities? Then it would behave more like an index than another pegged currency.

Looking for honest exchange.

Regards,
Curious

[cryptog]

Good question.

First of all, Nu could peg to another entity if needed. See here (“If USD becomes unstable”).
Second of all, it seems that the USD is strenghtening. See here.
We might shift to a basket of currencies as the world reserve currency soon, in which the Yuan would play an important role but the thing with the USD is that it is not an American currency any more.
Most of the USD are held by foreign countries and those foreign countries do not want to the USD to vanish since they hold a lot of US treasuries (China, Japan, Russia, Germany to name a few).
So pegging to the USD makes sense right now.

[mhps]

I am genuinely curious as the the reasons for pegging Nubits to the US dollar.

Because USD is the most liquid non-crypto assets that cryptoexchanges have. USD is also what most of world’s commerce use to clear their transactions.

Why not fix it to a basket of currencies and manage the weightings in the basket? Or a basket of currencies and commodities? Then it would behave more like an index than another pegged currency.

see Poll: (Closed) When we are ready for a second coin, which type should be the first to launch?

[Curiousbut]

Hi cryptog,

Thanks for your reply. I guess that makes sense.

I think USD strength will result in QE4, but l was really talking about long term.

Given the high spreads on small foreign exchange transactions, does this offer up an arbitrage opportunity between USD/NBT and NBT/XXX?

Cheers,
Curious

[cryptog]

sorry. I do not have the knowledge to answer this question.

[crypto_coiner]

I guess now we can offer a much richer answer to @Curiousbut