kaal:claim:3402701-021

Contesting the common assumption that a 100 percent reserve is required to guarantee a peg, the authors argue full reserves are not always necessary for any currency that has intrinsic worth.

Source quote, verbatim

On the contrary, we argue that a 100% reserve is not always necessary, as is the case with any currency which has an intrinsic worth

From

Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Stable Cryptocurrencies - First Order Principles (2019), 3.1.2.3 Hot Money Ratio, p. 20
https://ssrn.com/abstract=3402701 · source PDF

Cite as

Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Stable Cryptocurrencies - First Order Principles (2019). SSRN: https://ssrn.com/abstract=3402701

Holds when

currency possesses intrinsic worth, for example genuine transactional use

Classification

conditionsupport: arguedinstitutional-design

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