Stablecoins Pegged to Fiat Currency Are Not Stable
“Stablecoins” pegged to fiat currencies such as the USD are ultimately going to zero, just as all fiat currencies eventually do.
How do you save a fiat currency suffering hyperinflation (50% daily currency depreciation)? You peg it to physical Gold reserves.
FDR killed the USD when he said Americans may no longer exchange their cash for gold. Nixon’s August 1971 decree (officially taking the U.S. off of the gold standard), was the final nail in the USD’s coffin as it unleashed profligate fiscal spending.
So long as the U.S. continues to run multi-trillion Dollar fiscal deficits, the USD can only go in one direction: down, down, down (versus gold).
In the chart below, the Dollar’s devaluation is precisely the opposite of Gold’s appreciation. Peg to the Dollar and you will suffer the Dollar’s fate.
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