Cross-sectional data on stablecoin characteristics

Włosik, Katarzyna; Łęt, Blanka; Sobański, Konrad; Świder, Wojciech

doi:10.12688/f1000research.126298.1

Cited by 4 publications

(2 citation statements)

References 8 publications

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“…Although the use of stablecoins is growing steadily (Włosik et al, 2022), stablecoin trading and use are not without risks (Echarte Fernández et al, 2022;Moura de Carvalho et al, 2022;Vučinić, 2020). These risks can be summarized into three categories: counterparty risks (Arner et al, 2020;Mikhaylov, 2023); centralization risks (Mikhaylov, 2023); and the risk of algorithm manipulations (Clements, 2021).…”

Section: Resultsmentioning

confidence: 99%

The asset-backing risk of stablecoin trading: the case of Tether

Fernández,

Alonso

2024

EBR

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This article aims to analyse the asset-backing risk of stablecoins, focusing on international accounting standards, classification criteria, and auditing standards and using Tether as a case study. It examines Tether’s issuance, backing, controls, ratios, and regulations to assess risk transmission and mitigation. The results suggest a need for unified and strengthened accounting and auditing standards to enhance user confidence. Liquidity, solvency, and debt ratios were applied to Tether's balance sheets; while Tether has made efforts to increase its transparency, and although it possesses highly liquid assets, challenges remain regarding its liquidity, solvency, and debt. An independent auditors' valuation is crucial for investor confidence, demonstrating that more specific regulations are required for stablecoins. Future research should explore other stablecoins to comprehensively understand the accounting and auditing challenges in the field.

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Section: Resultsmentioning

confidence: 99%

The asset-backing risk of stablecoin trading: the case of Tether

Fernández,

Alonso

2024

EBR

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“…Finally, the data concerning the tulip bubble have been extracted from Thompson (2006) and are expressed in a daily quote reconstructed by the cited author. These data mining methods have been previously used in cryptocurrency papers such as those of Włosik et al (2022), Łęt et al (2022) and Łęt et al (2023). Table 1 shows the essential parameters of the bubbles under study.…”

Section: Materials and Methodologymentioning

confidence: 99%

Bitcoin’s bubbly behaviors: does it resemble other financial bubbles of the past?

Náñez Alonso,

Jorge-Vázquez,

Echarte Fernández

et al. 2024

Humanit Soc Sci Commun

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A number of financial bubbles have occurred throughout history. The objective of this study was to identify the main similarities between Bitcoin price behavior during bubble periods and a number of historical bubbles. Once this had been carried out, we aimed to determine whether the solutions adopted in the past would be effective in the present to reduce investors’ risk in this digital asset. This study brings a new approach, as studies have previously been conducted analyzing the similarity of Bitcoin bubbles to other bubbles individually, but these were not conducted in such a broad manner, addressing different types of bubbles, and over such a broad time period. Starting from a dataset with 9967 records, a combined methodology was used. This consisted of an analysis of the standard deviations, the growth rates of the prices of the assets involved, the percentage increase in asset prices from the origin of the bubble to its peak and its fundamental value, and, finally, the bubble index. Lastly, correlation statistical analysis was performed. The results obtained from the combination of the above methods reveal the existence of certain similarities between the Bitcoin bubbles (2011, 2013, 2017, and 2021) and the tulip bubble (1634–1637) and the Mississippi bubble (1719–1720). We find that the vast majority of the measures taken to avoid past bubbles will not be effective now; this is due to the digital and decentralized nature of Bitcoin. A limitation of the study is the difficulty in making a comparison between bubbles that occurred at different historical points in time. However, the results obtained shed light and provide guidance on the actions to be taken by regulators to ensure the protection of investors in this digital asset.

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