What is a Stablecoin?

stablecoin is a type of crypto currency that is designed to be pegged to a cryptocurrency, fiat money, or to exchange-traded commodities.

A video explanation of stablecoins

Stablecoins come in all shapes and sizes, but they all serve a single purpose; to provide stability. By providing stability in the cryptocurrency market, they’ve effectively brought more confidence into the market by allowing participants a ‘safe space’ to store their money away from the volatility of the crypto currency markets.

Example: Tether and USDC are pegged to the U.S. dollar. So that 1 USDC is roughly equal to 1 USD in value.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: