Stablecoins are crypto coins that are stable in price and are not subject to volatility. They are meant to be a replacement for fiat currency, which means that they can be used for all transactions, similar to the U.S. dollar. This is because of their stability and the fact that they don’t rely on a third party to maintain their value. There are a few different types of stablecoins, but I’ll focus on two: the dollar-backed tether (USDT) and the euro-backed e-krona (EEK). The reason these coins are so popular is because they offer an alternative to traditional currencies, which have been hit with massive inflation and many other problems in recent years.
In the next ten years, we will see a rise in digital currencies that are replacing our traditional fiat currencies. Stablecoins are digital currencies that are designed to have a fixed value and are usually pegged to a basket of other cryptocurrencies. This means they are more stable than other types of cryptocurrencies and are not affected by market volatility. They can be used to make transactions easier, especially in countries with unstable currency.
USDT is a stablecoin (stable-value cryptocurrency) that mirrors the price of the U.S. dollar, issued by a Hong Kong-based company Tether. The token’s peg to the USD is achieved via maintaining a sum of commercial paper, fiduciary deposits, cash, reserve repo notes, and treasury bills in reserves that is equal in USD value to the number of USDT in circulation.
USD Coin (known by its ticker USDC) is a stablecoin that is pegged to the U.S. dollar on a 1:1 basis. Every unit of this cryptocurrency in circulation is backed up by $1 that is held in reserve, in a mix of cash and short-term U.S. Treasury bonds. The Centre consortium, which is behind this asset, says USDC is issued by regulated financial institutions.
Binance USD (BUSD) is a 1:1 USD-backed stable coin issued by Binance (in partnership with Paxos), Approved and regulated by the New York State Department of Financial Services (NYDFS), The BUSD Monthly Audit Report can be viewed from the official website. Launched on 5 Sep 2019, BUSD aims to meld the stability of the dollar with blockchain technology. It is a digital fiat currency, issued as ERC-20 and supports BEP-2.
DAI is an Ethereum-based stablecoin (stable-price cryptocurrency) whose issuance and development is managed by the Maker Protocol and the MakerDAO decentralized autonomous organization. The price of DAI is soft-pegged to the U.S. dollar and is collateralized by a mix of other cryptocurrencies that are deposited into smart-contract vaults every time new DAI is minted.
The Pax Dollar was created by Charles Cascarilla and Rich Teo. What makes it uniquie is that the Pax Dollar is a stablecoin that allows any user to exchange U.S. dollars for the Pax Dollar Tokens. Its main goal is to stabilize the dollar with blockchain technology. The Paxos company has a charter from the New York State Department of Financial Services that allows them to offer regulated services within the crypto asset world.
TrueUSD is a U.S. dollar stablecoin pegged to USD at 1:1. First launched to a limited investor base in January 2018, TrueUSD has since grown to incorporate almost $400 million of backed tokens as of October 2020. TrueUSD is one of a number of cryptocurrency stablecoins administered by TrustToken, a platform for tokenizing real-world assets. As with other stablecoins, TrueUSD aims to facilitate increased liquidity and provide cryptocurrency traders and general users with a nonvolatile asset relative to free-floating tokens such as Bitcoin (BTC).
USDD is an algorithmic stablecoin that runs on TRON, a multipurpose smart contract blockchain, BNB Chain, and Ethereum. The stablecoin is pegged to the US dollar in a 1:1 ratio. TRON DAO Reserve chose to peg USDD’s price to the US dollar because it is the most widely used fiat currency globally.
Neutrino Dollar (USDN) is the first synthetic asset issued through the Neutrino Protocol, an algorithmic lending protocol built on the Waves blockchain that allows for the creation of crypto-collateralized stablecoins tied to a specific real-world asset.
Fei protocol is a DeFi native algorithmic stablecoin. The aim of Fei is to propose a technological solution in a sweet spot between rigid overcollateralized decentralized stablecoin and centralised custodial stablecoins. Fei Protocol runs on two crypto assets: FEI stablecoin and TRIBE governance token.
Gemini dollar™ is a stablecoin that combines the creditworthiness and price stability of the U.S. dollar with the technological advantages of a cryptocurrency. Gemini dollar is issued by Gemini, a New York trust company regulated by the New York State Department of Financial Services.
TRIBE is an Ethereum token that governs Fei Protocol, which issues a separate, decentralized stablecoin called FEI that attempts to maintain a value of US$1.00. TRIBE can be used to vote for Fei Protocol upgrades and to adjust FEI stablecoin monetary policy.
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Fractional-Algorithmic – Frax is a unique stablecoin with parts of its supply backed by collateral and parts of the supply algorithmic. The ratio of collateralized and algorithmic depends on the market’s pricing of the FRAX stablecoin. If FRAX is trading at above $1, the protocol decreases the collateral ratio. If FRAX is trading at under $1, the protocol increases the collateral ratio.
Liquity USD (LUSD) is the USD-pegged stablecoin used to pay out loans on the Liquity protocol. At any time it can be redeemed against the underlying collateral at face value. To borrow you must open a Trove and deposit a certain amount of collateral (ETH) to it and can then draw LUSD up to a collateral ratio of 110%.
HUSD is a fiat-collateralized stablecoin that offers the advantages of transacting with blockchain-based assets while mitigating price risk. The HUSD are issued as ERC-20 tokens on the Ethereum blockchain and are collateralized 1:1 by USD held in Paxos-owned US bank accounts.
Produced by STASIS, EURS was developed to tokenize the traditional fiat asset known around the world as the Euro. EURS mirrors the value of the Euro on the blockchain, and is said to be supported by liquidity assurance mechanisms combining the benefits of a global fiat with the transparency, immutability and efficiency of the blockchain.
$USDX is the native stablecoin of the Kava ecosystem. While $USDX is not directly pegged to a value of $1 by any specific mechanism, its stability is derived from market flows and influenced by Kava governance decisions.
sUSD is a synthetic USD token enabled by the Synthetix protocol. It tracks the price of the US Dollar through price feeds supplied by Chainlink’s decentralized network of oracles. sUSD is integrated across the DeFi ecosystem as one of the most liquid decentralized stablecoins, including at Curve. It can be traded without slippage for other assets native to the Synthetix protocol at Kwenta or Synthetix.Exchange.
What is XSGD? XSGD is the Singapore-Dollar-backed stablecoin issued on a 1:1 basis by StraitsX, a major payment institution that is licensed for e-money issuance activity. StraitsX is a Singapore-based payments company that is focused on enabling businesses to accept payments and send money.
Celo Dollars (cUSD) are a stablecoins that follow the US Dollar and are native to the Celo blockchain’s Reserve system. The Celo Reserve is a system of smart contracts that uses a portfolio of cryptocurrencies to expand and contract the supply cUSD, similar to MakerDAO’s lending protocol.
MUSD is a decentralized stablecoin running on Ethereum that attempts to maintain a value of US$1.00. Unlike centralized stablecoins, MUSD isn’t backed by US dollars in a bank account. Instead, it’s backed by an array of other stablecoins deposited as collateral on the mStable protocol.
The Reserve token (RSV) is a non-volatile cryptocurrency created by Reserve Protocol. Completely decentralized, the RSV token is backed by a changing basket of digital assets. In 2019, at the time of launch, these assets included USD Coin (USDC), True USD (TUSD), and Paxos Standard (PAX).
Steem Dollars (commonly abbreviated SBD) are liquid stable-value currency tokens designed to be pegged to $1 USD. Steem Dollars can be traded with STEEM, and transferred to other accounts for commerce or exchange.
Top Stablecoins by Market Cap
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