What Is Stablecoin?

A stablecoin is a type of cryptocurrency whose value is tied to an asset such as the U.S. dollar or gold to maintain a stable price. Stablecoins aim to provide price stability and reduce volatility compared to other cryptocurrencies. They are implemented as ERC-20 tokens on various blockchains and managed by smart contracts.

Stablecoins are widely used in DeFi as the quote token in trading pairs, as deposits in lending protocols, and as the base asset in liquidity pools and vaults.

Example stablecoins include

  • Circle USD - USDC

  • Binance dollar - BUSD

  • Tether dollar - USDT

  • USDF (yield-bearing)

Browse stablecoin vaults on Trading Strategy.

See also