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Stablecoins are a special type of cryptocurrency designed to maintain a fixed value over time. Unlike volatile cryptocurrencies like Bitcoin and Ethereum, stablecoins are pegged to a traditional ...
“Binance uses its chain for CeFi and DeFi operations and has a Layer 2, called opBNB, that uses Optimism rollups. ... Tether is one of the most well-known stablecoins. Unlike other ...
Stablecoins are a new and exciting way to take your cryptocurrency investments into the future. They offer you peace of mind by providing price stability, which means that these currencies will ...
The value of stablecoins of this type is based on the value of the backing currency, which is held by a third party–regulated financial entity. Fiat-backed stablecoins can be traded on exchanges and are redeemable from the issuer. The stability of the stablecoin is equivalent to the cost of maintaining the backing reserve and the cost of ...
Tether is the largest cryptocurrency in terms of trading volume, holding 70% of the market share among stablecoins. In 2019, it surpassed bitcoin to become the most traded cryptocurrency globally. [ 8 ] [ 9 ] [ 10 ] As of July 2024, Tether has more than 350 million users worldwide.
Terra is a blockchain that leverages fiat-pegged stablecoins to power a payment system. For consensus, the Terra blockchain uses a proof-of-stake codesign. [4] Several stablecoins are built atop the Terra protocol, [4] including TerraUSD, which was the third largest stablecoin by market capitalisation before its collapse in May 2022. [5]
DeFi offers an appealing alternative: open financial infrastructure that is publicly accessible, user-owned rather than privately owned, transparent, and cost-effective for businesses and users alike.
Notably, these designs are not foolproof, as a number of stablecoins have crashed or lost their peg. For example, on 11 May 2022, Terra 's stablecoin UST fell from $1 to 26 cents. [ 50 ] [ 51 ] The subsequent failure of Terraform Labs resulted in the loss of nearly $40B invested in the Terra and Luna coins. [ 52 ]