#BigTechStablecoin Stablecoins are a type of cryptocurrency designed to maintain a stable value, typically by pegging their price to a less volatile asset like the U.S. dollar, gold, or even other cryptocurrencies. This stability differentiates them from highly volatile cryptocurrencies like Bitcoin and Ethereum, making them suitable for everyday transactions, payments, and as a store of value.

There are primarily three types:

* Fiat-backed: Most common, these are collateralized 1:1 with traditional currencies held in reserves (e.g., USDT, USDC).

* Crypto-backed: Backed by other cryptocurrencies, often over-collateralized to manage volatility (e.g., DAI).

* Algorithmic: Rely on smart contracts and algorithms to maintain their peg by adjusting supply and demand, though some have proven risky (e.g., the collapsed TerraUSD).