Stablecoin
Crypto asset pegged to a stable value like the dollar or euro.
Beginner-friendly explanation
A stablecoin is a special cryptocurrency that always keeps the same value, often equal to 1 dollar or 1 euro. This allows you to stay in the crypto world without suffering from strong price swings.
Example: 1 USDT is almost always worth 1 US dollar.
Intermediate-level insight
Stablecoins are backed by reserves (fiat, crypto, algorithms). There are centralized stablecoins (e.g., USDC) and decentralized ones (e.g., DAI). They facilitate trading, DeFi, and crypto saving by providing stability and liquidity.
Example: On a crypto exchange, Bitcoin/USDT trading pairs are widely used thanks to the stablecoin’s stability.
Advanced perspective
Stablecoin design relies on complex mechanisms: collateralization, stabilization algorithms, or hybrids.
Example: The collapse of Terra’s algorithmic stablecoin UST in 2022 illustrates the risks of poorly collateralized models.
Cryptocurrencies & Tokens
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