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Stablecoin

    Stablecoins are a cryptocurrency pegged to “stable” reserves, such as the USD or gold. Because of its peg to a reserve asset by design, stablecoin prices are more stable and experience less market volatility than other cryptocurrencies. Stablecoins provide a link between cryptocurrency and more traditional fiat currencies. Stablecoins bridge cryptocurrency with traditional currencies, resulting in a digital currency convenient for day-to-day commerce and transfers between exchanges. This form of digital currency continues to grow in popularity, with numerous stablecoin projects on the market. While the mechanisms vary from one stablecoin to another, these coins have proven to be somewhat resistant to market volatility and should not experience significant price fluctuations. While most stablecoins peg the US dollar, some peg it to other cryptocurrencies and commodities. By being pegged to real-world assets, stablecoins have avoided the wild price swings caused by the high levels of volatility characteristic of cryptocurrency markets.

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