This is an interesting development, but every smart contract platform is going to have its own coin pegged to the dollar (just like Dai/Ethereum/MakerDAO). And with these coins everyone will be able to lock the main coin into a smart contract and create the stable coin out of thin air. This such a superior system than anything the establishment can offer.

There's really no reason to trust a central authority anymore when it comes to pegging assets. Why trust a centralized agency when you don't have to?

Also, how could pegged assets possibly "compete" with one another? Theoretically, if you aren't operating a fractional reserve, there is no real advantage in having a bigger community use your stable coin. It isn't really Tether that's competing with anything. Only the centralized exchanges are competing to siphon fees from their consumers.