Sexy StableCoins 🍑

There is something called as StableCoins but what the F is it? Wanna know, lets fasten your seatbelt and get on the ride with us 🚀

What are StableCoins?

Stablecoins are cryptocurrencies whose value is pegged, or tied, to that of another currency, commodity, or financial instrument. Stablecoins aim to provide an alternative to the high volatility of the most popular cryptocurrencies, including Bitcoin (BTC), which has made crypto investments less suitable for common transactions.

How does StableCoin Work?

Stablecoins attempt to peg their market value to some external reference, usually a fiat currency. They are more useful than more-volatile cryptocurrencies as a medium of exchange. Stablecoins may be pegged to a currency like the U.S. dollar or to the price of a commodity such as gold or use an algorithm to control supply. They also maintain reserve assets as collateral or through algorithmic formulas that are supposed to control supply.

The Best StableCoin

The most popular and largest stablecoin by market capitalisation is Tether (USDT). It is pegged to the U.S. dollar at a 1:1 ratio and backed by gold reserves.

That's it for the day, Web3Shala Signing Off ✌🏻

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