Stablecoins by Market Capitalization (Page 2)
A stablecoin is a type of cryptocurrency that is designed to maintain a stable value by being pegged to an external reference, such as a fiat currency.
What is a stablecoin? Stablecoin is a cryptocurrency that is designed to minimize volatility by pegging to a more stable asset. Fiat currency digital asset is the most popular use case for stablecoins. It typically tracks popular national currencies such as the US Dollar, Euro, and the British Pound. Benefit of this includes being able to take advantage of blockchain technology and peer-to-peer value transfer while not being exposed to high volatility such as Bitcoin, Ethereum, or other cryptocurrencies. Stablecoins are relatively new kind of technology and each of them comes with different implementations, liquidity, risks, and acceptance.
| # | Coin | Price | 1h | 24h | 7d | 30d | 24h Volume | Market Cap | FDV | Market Cap / FDV | Last 7 Days | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
USDCx (Stacks)
USDCX
|
$1.00 | 0.2% | 0.4% | 0.1% | 0.3% | $178,446 | $13,282,669 | $13,282,669 | 1.0 |
|
|||
| 997 |
eSui Dollar
SUIUSDE
|
$0.9990 | 0.0% | 0.0% | 0.0% | 0.0% | $7,808.68 | $13,082,922 | $13,082,922 | 1.0 |
|
||
| 1027 |
VCRED
VCRED
|
$0.9935 | 0.2% | 0.4% | 0.3% | 3.0% | $3.34 | $12,518,089 | $993,499,134 | 0.0126 |
|
||
| 1023 |
Stable Mint USD
USDSM
|
$0.9980 | 0.0% | 0.5% | 0.6% | 5.5% | $3,538.51 | $12,450,889 | $12,450,889 | 1.0 |
|
||
| 1024 |
USD CoinVertible
USDCV
|
$0.9992 | 0.0% | 0.0% | 0.0% | 0.0% | $9,345,288 | $12,412,404 | $12,412,404 | 1.0 |
|
||
| 1031 |
XSGD
XSGD
|
$0.7814 | 0.0% | 0.0% | 0.2% | 1.1% | $157,492 | $12,240,428 | $12,240,428 | 1.0 |
|
||
|
USDB
USDB
|
$1.00 | 0.1% | 0.7% | 1.0% | 0.4% | $8,927.62 | $12,045,297 | $12,045,297 | 0.9999999999999996 |
|
|||
Staked YUSD
SYUSD
|
$1.04 | 0.0% | 0.2% | 0.2% | 0.2% | $12.98 | $11,797,542 | $11,797,542 | 0.9999999999999996 |
|
|||
| 1050 |
YUSD Stablecoin
YUSD
|
$0.9955 | 0.1% | 0.1% | 0.0% | 0.0% | $2.19 | $11,793,900 | $11,793,900 | 0.9999999999999999 |
|
||
| 1047 |
MAI
MIMATIC
|
$0.9883 | 0.0% | 0.3% | 1.0% | 0.5% | $10,836.88 | $11,725,806 | $301,580,898 | 0.03888112886319894 |
|
||
| 1048 |
Freedom Dollar
FUSD
|
$0.9992 | 0.0% | 0.0% | 0.0% | 0.0% | $176,014 | $11,690,714 | $11,690,714 | 1.0 |
|
||
| 655 |
Youves uUSD
UUSD
|
$0.9986 | 0.0% | 0.1% | 0.7% | 0.1% | $44.64 | $11,520,967 | $11,520,967 | 1.0 |
|
||
| 1064 |
Hydrated Dollar
HOLLAR
|
$1.00 | 0.0% | 0.2% | 0.3% | 0.3% | $397,388 | $11,385,097 | $11,385,097 | 0.9999999999999996 |
|
||
| 1109 |
Nest Alpha Vault (LP)
INALPHA
|
$0.9542 | 0.0% | 0.0% | 0.0% | 0.0% | - | $10,442,662 | $1.89 | 5528089.264413382 |
|
||
| 1117 |
USDPT | Western Union
USDPT
|
$0.9990 | 0.0% | 0.0% | 0.1% | 0.1% | $261,048 | $10,113,187 | $10,113,187 | 1.0 |
|
||
| 1119 |
eUSD
EUSD
|
$0.9992 | 0.0% | 0.0% | 0.0% | 0.0% | $39,469.46 | $10,093,506 | $10,093,506 | 1.0 |
|
||
| 1121 |
USDA
USDA
|
$0.9998 | 0.0% | 0.1% | 0.1% | 0.1% | $3,321,397 | $9,997,674 | $9,997,674 | 1.0 |
|
||
| 1144 |
Rupiah Token
IDRT
|
$0.00005646 | 0.0% | 3.3% | 0.0% | 15.3% | $6.35 | $9,816,787 | $9,816,787 | 1.0 |
|
||
Alchemix USD
ALUSD
|
$0.9457 | 0.0% | 0.1% | 0.4% | 0.6% | $24,408.10 | $9,747,102 | $9,747,102 | 1.0 |
|
|||
| 1144 |
USDM
USDM
|
$0.9959 | 0.1% | 0.6% | 0.7% | 1.0% | $320,552 | $9,586,047 | $9,586,047 | 1.0 |
|
||
Indigo Protocol iUSD
IUSD
|
$0.9887 | 0.5% | 1.0% | 2.7% | 2.6% | $3,723.91 | $9,414,754 | $9,414,754 | 1.0 |
|
|||
| 1192 |
StablR USD
USDR
|
$0.4200 | 0.0% | 0.1% | 25.2% | 2640.2% | $10.58 | $8,851,131 | $8,851,131 | 1.0 |
|
||
| 1191 |
Wrapped iTRY
WITRY
|
$0.02372 | 0.0% | 0.0% | 0.3% | 1.2% | - | $8,737,307 | $8,737,307 | 1.0 |
|
||
| 1196 |
EURØP
EUROP
|
$1.16 | 0.1% | 0.1% | 0.1% | 1.1% | $26,077.15 | $8,662,247 | $8,662,247 | 1.0 |
|
||
| 1207 |
Bitcoin USD (BTCFi)
BTCUSD
|
$1.00 | 0.2% | 2.4% | 0.4% | 0.2% | $1,945.57 | $8,508,985 | $5,589,045 | 1.522439811146263 |
|
||
| 1257 |
Honey
HONEY
|
$0.9991 | 0.1% | 0.0% | 0.1% | 0.5% | $102,432 | $7,824,067 | $7,824,067 | 1.0 |
|
||
| 1292 |
Anzen USDz
USDZ
|
$0.9781 | 0.1% | 0.0% | 0.2% | 0.6% | $3,710.76 | $7,377,219 | $7,377,219 | 1.0 |
|
||
| 1311 |
STASIS EURO
EURS
|
Buy
|
$1.21 | 0.6% | 0.1% | 0.2% | 2.5% | $130.70 | $7,122,394 | $7,122,394 | 1.0 |
|
|
| 1275 |
Unity
UTY
|
$0.9992 | 0.0% | 0.0% | 0.0% | 0.0% | $152.88 | $7,003,344 | $14,529,019 | 0.48202456858164466 |
|
||
| 1297 |
HUSD
HUSD
|
$0.03723 | 0.0% | 0.7% | 0.4% | 3.2% | $1.51 | $6,993,250 | $6,993,250 | 0.9999999999999996 |
|
||
| 1324 |
Quantoz USDQ
USDQ
|
$0.9980 | 0.0% | 0.0% | 0.0% | 1.0% | $2,553,787 | $6,986,237 | $6,986,237 | 1.0 |
|
||
| 1342 |
Anzens USDA
USDA
|
$0.9972 | 0.7% | 0.5% | 1.5% | 0.5% | $33,533.70 | $6,740,793 | $6,740,793 | 1.0 |
|
||
| 1346 |
Australian Digital Dollar
AUDD
|
$0.7052 | 0.1% | 0.3% | 0.2% | 2.2% | $2,317.50 | $6,710,716 | $6,710,716 | 1.0 |
|
||
SoulPeg USD
SPUSD
|
$0.9980 | 0.0% | 0.1% | 0.3% | 24.5% | $3,039.33 | $6,708,081 | $6,708,081 | 1.0 |
|
|||
| 1357 |
AIUSD
AIUSD
|
$0.9992 | 0.0% | 0.0% | 0.0% | 0.0% | $14,428.90 | $6,636,960 | $6,636,960 | 1.0 |
|
||
| 1416 |
Stables Labs USDX
USDX
|
$0.009061 | 0.3% | 5.5% | 20.6% | 22.0% | $11.79 | $6,202,742 | $6,202,742 | 1.0 |
|
||
| 1400 |
Origin Dollar
OUSD
|
$0.9992 | 0.0% | 0.0% | 0.0% | 0.1% | $10,043.96 | $6,199,113 | $6,199,113 | 1.0 |
|
||
| 1406 |
Cod3x USD
CDXUSD
|
$0.9953 | 0.0% | 0.0% | 0.1% | 0.1% | $156.50 | $6,120,834 | $6,120,834 | 1.0 |
|
||
| 1438 |
AxCNH
AXCNH
|
$0.1485 | 0.0% | 0.1% | 0.6% | 0.2% | $31.18 | $5,811,536 | $5,811,536 | 1.0 |
|
||
| 1458 |
GYEN
GYEN
|
$0.005532 | 0.0% | 12.1% | 3.1% | 3.6% | $8.26 | $5,594,736 | $5,594,736 | 1.0 |
|
||
| 1459 |
Kyrgyz Som Stablecoin
KGST
|
$0.01143 | 0.0% | 0.0% | 0.1% | 0.1% | $159,805 | $5,539,133 | $5,539,133 | 1.0 |
|
||
| 1496 |
Quantoz EURQ
EURQ
|
$1.13 | 0.9% | 0.9% | 1.8% | 0.2% | $3,451,165 | $5,210,477 | $6,776,242 | 0.7689330976181666 |
|
||
Staked USD Coin
SUSD
|
$0.9952 | 0.1% | 0.2% | 0.3% | 24.3% | $2,305.30 | $5,085,269 | $5,100,759 | 0.9969631659519964 |
|
|||
| 1523 |
VNX Swiss Franc
VCHF
|
$1.23 | 0.1% | 0.7% | 0.5% | 0.2% | $98,484.64 | $5,004,822 | $5,004,822 | 1.0 |
|
||
| 1551 |
Startale USD
USDSC
|
$1.00 | 0.2% | 0.2% | 0.3% | 0.1% | $82,898.90 | $4,781,489 | $4,781,489 | 1.0 |
|
||
| 1563 |
Nectar
NECT
|
$0.9821 | 0.1% | 0.1% | 0.1% | 1.5% | $1,735.95 | $4,632,787 | $4,632,787 | 1.0 |
|
||
| 1581 |
ZARP Stablecoin
ZARP
|
$0.06121 | 0.0% | 0.0% | 1.4% | 0.7% | $3,179.51 | $4,528,215 | $4,528,215 | 1.0 |
|
||
| 1598 |
Plume USD
PUSD
|
$0.9996 | 0.1% | 1.9% | 0.6% | 0.4% | $2,556.87 | $4,445,598 | $4,445,598 | 1.0 |
|
||
| 1599 |
Stable Coin
SBC
|
$0.9990 | 0.0% | 0.0% | 0.0% | 0.0% | $27,591.97 | $4,423,810 | $4,423,810 | 1.0 |
|
||
| 1606 |
Flying Tulip USD
FTUSD
|
$0.9976 | 0.0% | 0.4% | 0.0% | 0.0% | $2,889.90 | $4,356,492 | $4,356,492 | 1.0 |
|
||
| 1674 |
Djed
DJED
|
$0.9804 | 0.5% | 0.5% | 1.2% | 0.5% | $47,867.91 | $3,940,303 | $3,940,303 | 1.0 |
|
||
| 1711 |
PHT Stablecoin
PHT
|
$0.01629 | 0.0% | 0.7% | 0.4% | 1.7% | $17.62 | $3,664,644 | $3,664,644 | 0.9999999999999999 |
|
||
Magic Internet Money (Arbitrum)
MIM
|
$0.05668 | 0.2% | 0.4% | 14.3% | 62.4% | $413.51 | $3,658,695 | $3,658,695 | 1.0 |
|
|||
| 1721 |
Fei USD
FEI
|
$0.9997 | 0.0% | 0.1% | 0.0% | 0.0% | $5,917.50 | $3,603,862 | $3,858,672 | 0.9339643794426806 |
|
||
| 1732 |
Forte AUD
AUDF
|
$0.6993 | 0.0% | 0.1% | 0.1% | 0.9% | $24,516.92 | $3,548,310 | $3,548,310 | 1.0 |
|
||
| 1761 |
Lumi Finance LUAUSD
LUAUSD
|
$0.4373 | 0.0% | 4.1% | 14.4% | 36.1% | $98.57 | $3,466,896 | $3,466,896 | 1.0 |
|
||
| 1790 |
Mento Euro
EURM
|
$2.20 | 0.0% | 91.1% | 91.2% | 92.6% | $5,288.96 | $3,245,541 | $3,245,541 | 0.9999999999999997 |
|
||
| 1801 |
Last USD
USDXL
|
$1.00 | 0.5% | 0.2% | 0.4% | 2.4% | $1,247.58 | $3,203,019 | $88,091,107,276 | 3.6360293585936016e-05 |
|
||
| 1819 |
Enosys Loans CDP
CDP
|
$0.9941 | 0.0% | 0.2% | 0.0% | 0.2% | $145,910 | $3,089,761 | $3,089,761 | 0.9999999999999999 |
|
||
Magic Internet Money (Ethereum)
MIM
|
$0.05493 | 0.0% | 41.2% | 27.0% | 63.9% | $10.02 | $3,054,655 | $9,606,310 | 0.3179841722054537 |
|
|||
| 1845 |
Dollar On Chain
DOC
|
$0.9849 | 0.3% | 1.9% | 1.4% | 1.0% | $3,957.43 | $2,965,275 | $2,965,275 | 0.9999999999999999 |
|
||
| 1806 |
Mu Digital AZND
AZND
|
$0.1784 | 0.0% | 33.0% | 81.6% | 81.9% | $1,209.42 | $2,912,973 | $2,912,973 | 1.0 |
|
||
| 1820 |
VNX EURO
VEUR
|
$1.04 | 0.0% | 260.7% | 260.7% | 10.6% | $0.1040 | $2,884,205 | $2,884,205 | 1.0 |
|
||
| 1863 |
mStable USD
MUSD
|
$1.00 | 0.0% | 0.3% | 0.2% | 0.4% | $52.91 | $2,879,845 | $2,879,845 | 1.0 |
|
||
StoneYield USD
STUSD
|
$0.9932 | 0.1% | 0.6% | 0.3% | 24.6% | $3,036.13 | $2,874,922 | $2,874,922 | 0.9999999999999997 |
|
|||
| 1881 |
Web 3 Dollar
USD3
|
$1.10 | 0.0% | 0.0% | 0.5% | 0.8% | $5,757.41 | $2,792,214 | $2,792,214 | 0.9999999999999998 |
|
||
| 1752 |
Balanced Dollars
BNUSD
|
$0.9677 | 0.0% | 62.8% | 43.0% | 1.2% | $1,315.59 | $2,756,147 | $2,756,147 | 1.0 |
|
||
| 1893 |
Parallel
PAR
|
$1.22 | 0.1% | 0.8% | 1.1% | 0.7% | $308.29 | $2,742,553 | $2,742,553 | 1.0 |
|
||
| 1954 |
BRL1
BRL1
|
$0.1942 | 0.0% | 0.9% | 0.7% | 0.6% | $1,014,449 | $2,530,571 | $2,530,571 | 0.9999999999999998 |
|
||
| 1966 |
Monetrix USD
USDM
|
$0.9950 | 0.4% | 0.1% | 0.5% | 0.3% | $229,274 | $2,492,939 | $2,492,939 | 1.0 |
|
||
| 2021 |
Macropod
AUDM
|
$0.7055 | 0.0% | 0.3% | 1.0% | 1.7% | $372,768 | $2,294,168 | $2,294,168 | 1.0 |
|
||
| 2035 |
RIF US Dollar
USDRIF
|
$0.9961 | 0.0% | 0.1% | 0.0% | 0.2% | $93.57 | $2,257,672 | $2,257,672 | 0.9999999999999998 |
|
||
| 2045 |
Aussie Dollar Token
AUDX
|
$0.7066 | 0.0% | 0.1% | 0.1% | 1.5% | $26.35 | $2,231,609 | $2,231,609 | 1.0 |
|
||
| 2083 |
Hermetica USDh
USDH
|
$1.00 | 0.0% | 0.3% | 0.4% | 0.6% | $5,738.30 | $2,115,477 | $2,115,477 | 1.0 |
|
||
| 2085 |
MXNB
MXNB
|
$0.05834 | 0.1% | 0.0% | 0.9% | 2.0% | $29,376.45 | $2,109,010 | $2,109,010 | 1.0 |
|
||
| 2090 |
US Sonic Dollar
USSD
|
$1.00 | 0.0% | 0.7% | 1.0% | 1.1% | $81,316.52 | $2,089,104 | $2,089,104 | 0.9999999999999998 |
|
||
WEMIX3.0 Bridged USDC (WEMIX3.0 DPoS)
USDC.E
|
$0.9964 | 0.0% | 0.5% | 0.4% | 0.0% | $57,376.93 | $1,991,356 | $1,991,356 | 1.0 |
|
|||
| 2132 |
Parallel USDp
USDP
|
$1.00 | 0.0% | 0.0% | 0.0% | 0.0% | $1,069.49 | $1,975,120 | $1,975,120 | 0.9999999999999998 |
|
||
| 2168 |
Compliant Naira
CNGN
|
$0.0007173 | 0.0% | 0.2% | 0.1% | 0.1% | $14.93 | $1,900,142 | $1,900,142 | 1.0 |
|
||
| 2177 |
Curve.fi FRAX/USDC
CRVFRAX
|
$1.01 | 0.0% | 0.1% | 0.0% | 0.1% | $15,512.94 | $1,842,891 | $1,842,891 | 1.0 |
|
||
| 2202 |
Vai
VAI
|
$0.9978 | 0.0% | 0.0% | 0.0% | 0.0% | $66.02 | $1,782,076 | $2,477,245 | 0.7193779526249676 |
|
||
| 2207 |
Sovryn Dollar
DLLR
|
$0.9783 | 0.3% | 0.8% | 2.4% | 2.1% | $80.25 | $1,769,882 | $1,769,882 | 0.9999999999999998 |
|
||
| 2241 |
USDCx (Movement)
USDCX
|
$0.9965 | 0.4% | 0.3% | 1.7% | 0.6% | $100,372 | $1,695,457 | $1,695,457 | 1.0 |
|
||
| 2261 |
Decentralized Euro
DEURO
|
$1.15 | 0.0% | 0.0% | 1.2% | 0.6% | $3.49 | $1,678,247 | $1,678,247 | 0.9999999999999998 |
|
||
EURA
EURA
|
$1.15 | 0.1% | 0.0% | 0.2% | 0.3% | $6,622.87 | $1,634,118 | $1,634,147 | 0.999982200976859 |
|
|||
| 2297 |
Brazilian real
WBRL
|
$0.1928 | 0.0% | 0.0% | 1.3% | 0.1% | $1,038.68 | $1,583,140 | $1,583,140 | 1.0 |
|
||
| 2306 |
USD+
USD+
|
$0.9990 | 0.0% | 0.0% | 0.0% | 0.0% | $8.91 | $1,564,430 | $1,564,430 | 1.0 |
|
||
| 2326 |
The Fedz FUSD
FUSD
|
$0.9490 | 0.1% | 0.2% | 0.1% | 1.8% | $80.52 | $1,527,946 | $1,527,946 | 1.0 |
|
||
| 2337 |
Solomon USDv
USDV
|
$0.9987 | 0.0% | 0.0% | 0.0% | 0.1% | $80.16 | $1,510,161 | $1,510,161 | 1.0 |
|
||
| 2391 |
SuperReturn sSuperUSD
SSUPERUSD
|
$1.08 | 0.2% | 0.1% | 1.3% | 0.1% | $165.74 | $1,427,232 | $1,427,232 | 1.0 |
|
||
| 2400 |
Inter Stable Token
IST
|
$0.9990 | 1.0% | 0.9% | 0.2% | 1.5% | $37.12 | $1,403,987 | - |
|
|||
| 2401 |
Mountain Protocol USD
USDM
|
$0.9961 | 0.0% | 0.0% | 0.2% | 0.0% | $0.05475 | $1,395,867 | $1,395,867 | 0.9999999999999998 |
|
||
| 2408 |
LeverUp USD
LVUSD
|
$1.00 | 0.0% | 0.5% | 0.7% | 0.9% | $1,611.21 | $1,389,902 | $1,389,902 | 1.0 |
|
||
| 2425 |
Liquid Loans USDL
USDL
|
$1.00 | 0.3% | 4.2% | 0.8% | 5.5% | $72,494.90 | $1,362,449 | $1,362,449 | 0.9999999999999997 |
|
||
| 2460 |
Blox MYRC
MYRC
|
$0.2435 | 0.0% | 0.5% | 0.3% | 0.2% | $12,275.92 | $1,293,165 | $1,293,165 | 1.0 |
|
||
| 2462 |
BiLira
TRYB
|
$0.02028 | 0.0% | 0.4% | 4.1% | 5.2% | $41.86 | $1,261,500 | $1,261,500 | 1.0 |
|
||
| 2451 |
XT Stablecoin XTUSD
XTUSD
|
$0.03797 | 0.0% | 96.2% | 96.2% | 96.2% | $50.54 | $1,245,547 | $1,245,547 | 1.0 |
|
||
| 2463 |
Chateau USD
CHUSD
|
$0.9995 | 0.0% | 0.1% | 0.1% | 0.0% | $999.68 | $1,230,484 | $1,230,484 | 1.0 |
|
||
ROME Stablecoin
ROME
|
$1.00 | 0.0% | 0.3% | 0.8% | 1.3% | $26.12 | $1,198,618 | $1,198,618,052,289 | 1.0e-06 |
|
|||
| 2538 |
Stablecorp QCAD
QCAD
|
$0.7186 | 0.0% | 0.1% | 1.0% | 1.7% | $388.23 | $1,187,138 | $1,187,138 | 1.0 |
|
||
Stablecoins Categories
| Name | 24h | Market Cap |
|---|---|---|
|
All Stablecoins
|
0.0%
|
$286,963,358,535
|
|
USD Stablecoin
|
0.0%
|
|
|
Fiat-backed Stablecoin
|
0.0%
|
|
|
MiCA-Compliant Stablecoin
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0.0%
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GENIUS Act Compliant Stablecoin
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0.0%
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Crypto-backed Stablecoin
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0.0%
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|
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US Treasury-backed Stablecoin
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1.1%
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Algorithmic Stablecoin
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0.2%
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Synthetic Dollar
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0.0%
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|
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EUR Stablecoin
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0.9%
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RUB Stablecoin
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2.3%
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All Stablecoins
MiCA-Compliant Stablecoin
Fiat-backed stablecoins that are fully authorized under the European Union's Markets in Crypto-Assets (MiCA) regulation. These assets are issued by regulated entities such as Electronic Money Institutions (EMIs) or licensed credit institutions and adhere to strict European standards regarding 1:1 liquid reserve backing, transparent public auditing, and safeguarded custody to ensure consumer protection and financial stability.
Algorithmic Stablecoin
An algorithmic stablecoin is a type of stablecoin that maintains its peg to a specific value, such as a fiat currency or other assets through algorithmic mechanisms. These mechanisms adjust the supply of the stablecoin based on market demand often by issuing more coins when the price is above the peg and buying back or burning coins when the price is below the peg.
Top Stablecoins Sectors Market Cap Chart
Major Stablecoins Sectors Performance Chart
What are Stablecoins
Stablecoins are a type of cryptocurrency pegged to a reference asset like fiat money, or other commodities like gold. Stablecoins minimize the volatility of the crypto space by maintaining their pegs. There are four major types of stablecoins: fiat-backed stablecoins, crypto-collateralized stablecoins, commodity-backed stablecoins, and algorithmic stablecoins.
Centralized Stablecoins
Fiat-backed stablecoins, like USDT and USDC, are issued by a central entity and backed by reserves that are equal or greater than their tokens in circulation. However, the reserve breakdown between USDT and USDC is quite different. In the case of USDT, this includes secured loans, corporate bonds, funds and precious metals in addition to cash and cash equivalents. On the other hand, USDC is only backed by U.S. Treasury Securities and cash deposits. Commodity-collateralized stablecoins are similar to fiat-backed stablecoins, except that they are backed by other physical assets like precious metals, oils, or real estate.
Decentralized Stablecoins
Unlike centralized stablecoins, which are issued by a central entity, decentralized stablecoins run on smart contracts, with governance input from a designated community (the DAO). DAI by MakerDao is an example of a decentralized stablecoin, and it is collateralized by other cryptocurrencies such as ETH. In order for DAI to maintain a stable price, users borrow against their locked collateral. Due to the volatility of cryptocurrencies, users must deposit collateral worth more than the value they intend to borrow, and this collateral can be liquidated by the protocol if the value decreases below a certain threshold.
Finally, there are algorithmic stablecoins. These rely on two tokens – a stablecoin and another cryptocurrency that serves as the backing of the stablecoin – and an algorithm (or smart contract) regulates the supply and demand so that the stablecoin can maintain its peg. This worked in the case of Terra’s UST and LUNA, until UST’s depeg in May 2022 resulted in arbitrageurs exchanging it for LUNA, which was then dumped on the open market, creating a freefall on both fronts.
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