#DeFiBreakdown 12 - #Stablecoin & #DeFi
As inherently stable crypto assets,
stablecoins have evolved into an integral part of both #DeFi & broader cryptocurrency ecosystems regardless of market highs and painful downturns.
We can break down
4 different types of stablecoin, identifiable by their underlying collateral structure: fiat-backed, crypto-backed, commodity-backed, and algorithmic.
At first glance, stablecoins may appear to be free from volatility, but they may pose risks to financial stability through different contagion channels. Anw, Stablecoins are incredibly versatile tools, offering a way to bridge the gap b/w fiat currencies & cryptocurrencies. They let users enjoy the benefits of digital currencies while helping to alleviate the problem of extreme price volatility.
There is no doubt about stablecoin growth as their total market cap has reached over $150B. They have found more and more use cases within the crypto landscape & continued to enthrall users by their value position.
