What is a #stablecoin
A stablecoin is a type of cryptocurrency whose value is designed to remain stable against a reference asset, such as:
A fiat currency (e.g., the US dollar, the euro, or the yen).
A physical asset (like gold).
Another cryptocurrency (less common).
Main features:
Stability: Unlike cryptocurrencies like Bitcoin or Ethereum, stablecoins avoid high volatility.
Backing: Their value remains stable thanks to a backing system, which can be:
Fiat-collateralized: Backed by real money in banks (e.g., USDT, USDC).
Crypto-collateralized: Backed by other cryptocurrencies with over-collateralization (e.g., DAI).
Algorithmic: Use algorithms to adjust supply and demand (e.g., UST, although these are riskier).
