Market basics · Glossary
Stablecoin
A token designed to hold a relatively stable value.
Definition and explanation
A stablecoin is a digital asset that aims to maintain a stable value, commonly around a fiat currency such as the US dollar. Stablecoins may be supported by reserves, an algorithmic mechanism or other approaches, and a specific coin's peg, backing and risk profile can differ. Stablecoin usage does not remove market or counterparty risk.
Example
Many trading pairs quote a crypto asset in a US dollar-pegged stablecoin, such as BTC/USDT, to simplify reading of the price.
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