What is a stablecoin?
StableCoins are digital assets with a total amount pegged to another asset. (In most cases, this is USD or another digital currency). Some examples: Tether, Gemini Dollar, USDC, and DAI
Why is it so stable?
Stablecoins act as a bridge between the crypto world and the fiat currency world. The company uses several centralized authorities that back each coin with a one-to-one equivalent in USD or Crypto and control price volatility.
Take Tether, one of the top cryptocurrencies today. The project is built on the Omni Protocol Layer on top of Bitcoin, ERC20 (Ethereum Smart Contract). Tether's founders claim that each Tether coin (USDT) is backed by an equivalent of 1 US dollar, but for years still have not provided any official documentation or audit.
TrueUSD (TUSD) . Another stablecoin that issues proof that each TUSD token is backed by $1. TUSD is based solely on the Ethereum blockchain, providing legal protection to TUSD holders and is open to third-party audits.
USDC is an Ethereum-based stablecoin created by Coinbase and Circle company
DAI is an Ethereum-based Stable Coin. It differs from other tablets by implementing a completely decentralized technology. The price is stable, the price is backed by Ether, not USD.
