What is a stablecoin?

Coinbase defines a stablecoin as a digital currency backed by safe currency. It is designed to reduce volatility compared to other crypto-currencies that are not backed by anything.

The asset chosen is a more stable value than other crypto-currencies.

A stablecoin can be indexed to FIAT currencies such as the dollar or euro, gold or silver. For example: 1 USD = 1$.

Stablecoin has contributed to the advent of DeFi.

Examples of stablecoin

– USDT (Tether),
– USDC (USDC Coin),
– Binance (USD – BUSD),
– TUSD (True USD – TrustToken),
– PAX (Paxos Standard),
– GUSD (Gemini Dollar),
– BUSD (Binance),
– DAI.

Exemples de stable coin
Blockchain tous les jours (8)

What is the purpose of a stablecoin?

– Exchange and record assets,
– Limit interest,
– Transfer money,
– Send money,
– Avoid volatility: protect against price movements by holding cryptocurrency,
– Access to foreign currencies: no limit on amount, low fees,
– No taxes.

There are 3 types of stablecoin

Centralized stablecoins: a central organization manages and controls its issuance.

– Decentralised stablecoins: no central entity interacts in the process. This system operates in a decentralized manner like Bitcoin and Ethereum.

Algorithmic stablecoins: a protocol acts as a central bank by increasing or decreasing the amount of tokens in circulation to maintain price stability.