What is a stablecoin?
Definition
A stablecoin is a digital currency that is pegged to a “stable” reserve asset like the U.S. dollar or gold. Stablecoins are designed to reduce volatility relative to unpegged cryptocurrencies like Bitcoin.
Stablecoins bridge the worlds of cryptocurrency and everyday fiat currency because their prices are pegged to a reserve asset like the U.S. dollar or gold. This dramatically reduces volatility compared to something like Bitcoin and results in a form of digital money that is better suited to everything from day-to-day commerce to making transfers between exchanges.
The combination of traditional-asset stability with digital-asset flexibility has proven to be a wildly popular idea. Billions of dollars in value have flowed into stablecoins like USD Coin (USDC) as they’ve become some of the most popular ways to store and trade value in the crypto ecosystem.
Why are stablecoins important?
The USDC stablecoin, for example, is backed by dollar-denominated assets of at least equal fair value to the USDC in circulation in segregated accounts with US regulated financial institutions. Such accounts are attested to (i.e. verified publicly) by an independent accounting firm.
Like many other stablecoins, USDC currently operates on the Ethereum blockchain. Stablecoins are free from the volatility of non-pegged cryptocurrencies, while inheriting some of their most powerful properties:
Stablecoins are open, global, and accessible to anyone on the internet, 24/7
They’re fast, cheap and secure to transmit
They’re digitally native to the Internet and programmable
What can you do with stablecoins?
Minimaliseer de volatiliteit. De waarde van cryptovaluta zoals Bitcoin en Ether fluctueert enorm - soms met de minuut. Een activum dat gekoppeld is aan een stabielere valuta kan kopers en verkopers zekerheid geven dat de waarde van hun tokens in de nabije toekomst niet onvoorspelbaar zal stijgen of dalen.
Handel of spaar activa. U heeft geen bankrekening nodig om stablecoins aan te houden en ze zijn gemakkelijk over te boeken. De waarde van Stablecoins kan gemakkelijk over de hele wereld worden verzonden, ook naar plaatsen waar de Amerikaanse dollar moeilijk te verkrijgen is of naar plaatsen waar de lokale valuta instabiel is.
Verdien beloningen Er zijn eenvoudige manieren om beloningen te verdienen (meestal hoger dan wat een bank zou bieden) op een stablecoin-investering.
Goedkoop geld overschrijven. Mensen hebben USDC ter waarde van een miljoen dollar verstuurd met overdrachtskosten van minder dan een dollar.
Internationaal verzenden. Snelle verwerking en lage transactiekosten maken stablecoins zoals USDC een goede keuze voor het verzenden van geld waar ook ter wereld.
Hoe werken ze?
Stablecoins are cryptocurrency tokens, so they all run on a blockchain, often Ethereum. To deliver stability, they need to have either an asset backing them up that everyone agrees has value, or a promise of credit from an extremely reliable and trusted source.
For instance, the value of the USD Coin (USDC) is meant to stay as close as possible to $1. It’s backed by actual dollars stored at financial institutions. And monthly audits ensure that all those dollars are accounted for, maintaining this 1:1 relationship.
Not all stablecoins are fully backed by a fiat currency or a commodity like gold—some are even backed by other cryptocurrencies. That said, it's key to do your homework: many of these stablecoins are still widely traded.
