A Note On Stablecoin – Anti-Stablecoin Asymmetry

Abstract

We explore the properties of a product, the so-called “anti-stablecoin,” inspired by a Twitter comment from a well-known cryptocurrency fund manager. This begins by providing a clear definition for such a product and then work several of its properties. We then sketch a general proof that anti-stablecoins require more capital than stablecoins while also constructing an anti-stablecoin design that requires an arbitrarily small quantum of incremental capital to work indefinitely. The main contribution here is to show that odd asymmetries exist between stablecoins and anti-stablecoins that feel foreign relative to traditional financial math.

Keywords: DeFi, Cryptocurrency, Stablecoins