Stablecoins refer to stable currencies in the blockchain, created as a requirement in order to provide stability to unpredictable changes in the price of crypto assets as a result of speculation that occurs in the markets, closely linked to the elevation and reduction in value
With this, it achieves and ensures its stable price, because it symbolizes a currency or money dependent on a central bank or official government, supported by money such as the dollar or euro, (fiat) or represented by material goods, thereby facilitating economic growth. without accelerated inflation occurring, but they may also not be linked to any asset and in order for its price to remain stable it is controlled through algorithms based on technology and moving quickly, efficiently and safely.
Therefore, the security and stability of prices occurs and becomes evident when non-specialized businesses or the general public face an accelerated adoption that would undoubtedly lead to a reduction in volatility in them.
Among the most popular Stablecoins on the market are:
Since its launch 9 years ago as an instrument for the stabilization of cryptocurrencies, now stablecoins, as the most popular currency in the market is Tether USD, linked laterally to Bitcoin, Omni and Layer.
A year later Tether, the Bitfinex exchange house as a platform, provided support to this stablecoin and then in 2015 the stable cryptocurrency, SteemUSD, was launched by the Steem group.
Later, it was joined by the first non-collateralized stablecoin through a project called Corion.
Another of the popular stablecoins is DAI, which together with the Ethereum network, these are disseminated through smart contracts and working with ETH as collateral and responding to the price of the US dollar.
Also as a key element in shaping the decentralized finance (DeFi) economy is DAI and it is one of the most successful and widely used as an asset for lending and decentralized exchanges (DEX) on platforms.
Facilitating users to use various multiple tokens to guarantee the issuance of the stablecoin. In other words, they can put new DAI into circulation by making deposits with other assets such as REP, BAT or OMG. .
Likewise, as stable coins, originally created by social networks, such as Facebook. Initially called Libra, it is now called Diem. It is based on asset baskets, a group of fiat currencies, which can be used to honor payments on the platform both inside and outside of Facebook, and is one of those that has caused the greatest impression as stablecoins in the market.
Stable coins, as their name defines them, tend to have a relatively reliable price in the long term because they are the only ones capable of maintaining their stability.
The stability of the stablecoins would be reeling if it were to suffer if the cryptocurrency with which it is linked exceeds the threshold at which it has been established.
Like tokens that are backed by another type of currency, the value of stablecoins is supported by assets such as oil, precious stones such as diamonds, gold and other external raw materials other than cryptocurrencies.
Faced with the inevitable losses and the prevailing nervousness evidenced by the loss of funds, they chose to sell some or all of their cryptocurrencies, affecting little to all cryptocurrencies in general to Bitcoin, Ethereum, Litecoin, Dogecoin, Solana, Cardano, in addition to thousands of others that were affected including the loss of their considerable value.
Among the various ways in which stablecoins could lose their stability is the danger of cryptographic whales because they can favor or harm the industry, since they keep immense or millionaire amounts of cryptocurrencies that affect the price of assets in case of making decisions in acquiring or, on the contrary, getting rid of a large property with a negative result in the balance of both supply and demand in the market.
If, on the contrary, you decide to buy and invest, it would have a positive and very favorable effect on the activities of the cryptographic market.
When an immense amount of cryptography is dropped in short periods of time, it causes decreases with the usual negative result for its respective price, probably the price could be recovered with the respective sales but if the market is already unfavorably affected and by its art a whale by launching a significant amount of counterproductive cryptocurrencies due to the serious consequences it unleashes.
And also, the lack of transparency is another aspect to consider, causing the vulnerability of stablecoins, subjecting them to risk and liquidity that it provides along with its stability.