Stablecoins: Why is there so much talk about them?
Stablecoins refer to a type of cryptocurrency, the values of which are generally pegged against a range of assets. These assets could be a government-issued currency, some kind of precious metal like silver or gold, and even some other cryptocurrency. They have the advantage of protecting their users from the fluctuations of the market and other risks. Some famous stablecoins and their value in terms of dollars have been given as follows:
· Tether (USDT) with a Market Cap of $1,884,587,370: Tether can be sold or bought at Binance, OKex, Huobi and many more.
· TrueUSD (TUSD) with Market Cap of $213,749,697: TrueUSD can be sold or bought at Binance, DigiFinex and Bit-Z.
· MakerDAO (DAI) with a Market Cap of $56,801,526: MakerDAO can be sold or bought at HItBTC, KuCoin and OasisDEX.
· Paxos Standard (PAX) with a Market Cap of $167,241,364: Paxos Standard can be sold or bought at DigiFinex, OKex and Binance.
· Gemini Dollar (GUSD) with a Market Cap of $86,072,734: Gemini Dollar can be sold or bought at HitBTC, BCEX and DigiFinex.
Since cryptocurrencies do not have any affiliation to a firm or a government, they are entirely dependent on the supply and demand structures in the market. As a result, they are quite volatile which is why there is a general lack of public trust in cryptocurrencies as a reliable currency option. Lack of regulations just ends up adding to this distrust and people end up viewing it as a speculative investment. Stablecoins are a much safer option in this respect.
Stablecoins are a faster and less expensive option when compared to other cryptocurrencies. They also allow for more liquidity and are less susceptible to the market-price fluctuations. In addition, stablecoins are also used in crypto lending.