122. Why can’t current stablecoins become standard currencies? What is the market pricing mechanism?

Answer: The standard currency must be priced by the market. Simply put, market pricing is determined by market supply and demand. When demand is greater than supply, prices rise, and vice versa.

The market pricing mechanism allows the price of DW20 to be entirely regulated by the market and is not linked to the economy of any country. Its market price directly depends on the demand for DW20 and the market’s adjustment ability. It faces the real market demand and represents the real market feedback. These are beyond the reach of manual adjustments. However, none of the stablecoins currently on the market rely entirely on market mechanisms to achieve market pricing; an anchor object is always required, so they cannot become standard currencies.

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