The crypto market has been bearish for most of the year 2O22. Bitcoin, Ethereum, Cardano, and several other crypto assets have experienced price fall with many hitting their all-time low.
Despite this, some categories of cryptocurrency are largely unaffected by this volatility in price. This set of cryptocurrencies is known as ”Stablecoin”. They are stable just as the name implies.
In this post, we’ll learn about stablecoins and also see the top ones in the crypto market today.
Get your writing materials ready, be stable, and learn about this category of virtual currencies.
What are Stablecoins?
Stablecoins are the type of altcoins that help to correct the volatility in the price of other cryptocurrencies. They are crypto-equivalent to fiat currencies like US dollars.
Crypto investors who needed something that could reliably hold value over time without the volatility and allow them to easily transfer that value invest in these tokens.
Stablecoins are useful for traders and investors in crypto trading. It is easier for them to move money in, out, and between crypto exchanges with Stablecoin, without waiting for banking procedures.
These coins have made it easier for investors to hold a part of their crypto portfolio like cash. This makes it possible to readily purchase any coin at any time without depending on bank services.
Top 5 Stablecoins in the Crypto Market
The top 5 Stablecoins are all pegged at 1:1 to the US dollar. They reside as tokens on blockchains that support smart contracts e.g. Ethereum, Binance smart chain, etc.
The top Stablecoins are-
1. Tether (USDT)
Tether is the most popular and largest Stablecoin. It was launched as ‘Real coin’ in 2014. Tether is always said to be worth one US dollar (its value is pegged to the USD). Its system allows users to make transactions from other cryptos back to the USD very fast and easily.
Tether is widely used in that it changes more hands in the cause of a single day than its entire market capitalization. Its current market value is $73.5 billion.
2. USD Coin (USDC)
This is a Stablecoin launched in 2018 by the Coinbase crypto exchange. It has its supply limited by its dollar reserves. The USD coin is accepted by most large exchanges. It also has increasing usage in decentralized finance (DeFi), DApps, and gaming. Its current market value is $34.35 billion.
3. Binance USD (BUSD)
BUSD was launched in 2019 by the world’s largest exchange, Binance. Its supply is limited by dollar reserves that are audited monthly. Users converting fiat currencies/cryptocurrencies to BUSD get to use Binance exchange services at zero fees. There is also the use of DeFi services that can earn extra. The current market value is $13.54 billion.
This Stablecoin was first launched in 2017. The token supply is limited by the collateral stored in its vaults. However, that collateral is not US dollars but other cryptos, which led to a balancing act in early 2019.
DAI can be used to trade but is more prevalent on DeFi protocol services. The total market value as of December 2021 is $6.47 billion.
5. Terra USD (UST)
This was launched in 2020 with an interesting way to maintain its peg of one UST per USD. Its supply will algorithmically change based on Terra’s native LUNA token’s price and supply. This is to cause an equilibrium that will keep its value.
UST can be used for payments and trade. It is better for DApps with DeFi services and the Anchor protocol that allows for deposits to earn reward/yield passively. Its current market value is $2.88 billion.
Where to buy Stablecoins?
These stablecoins are available on crypto exchanges and trading platforms. Coinbase and Binance have its stablecoin, users can easily buy and sell them on the platforms.
Other top stablecoins can also be found on Binance, OKX, Coinbase, ByBit, and so on. Stablecoins are cryptocurrencies backed by real assets such as treasury, commercial papers, and so on.
They are pegged to fiat currencies such as U.S dollar, Euros, Pesa, and so on. While many cryptocurrencies are affected by price volatility, stablecoins aren’t found in this league.
Stablecoins are a category of cryptocurrencies that are stable. This makes them not to be volatile like other cryptocurrencies. USDT, BUSD, DAI, UST, are few of the top stablecoins today.