Centralized vs. decentralized stablecoins - which are safer?
We try to answer this once and for all in our new article:https://pontem.network/posts/centralized-v-decentralized-stablecoins-which-are-safer
We look at the difference between the two types of stablecoins and what can go wrong with both, including counterparty and third party risks.
With centralized stablecoins, you face the risk that the issuer will lose access to the collateral reserves or will be sanctioned by a regulator. (USDC, USDT & BUSD)
But decentralized stables can suffer from flawed algorithms, market manipulation, or depeg if their reserves drop in value (UST, USDD, DAI).
We also examine stablecoins on Aptos, both bridged and native, such as Argo’s USDA, and give some tips on how to stay safe when holding stablecoins.
Let us know your thoughts in the comments!
