Blockchain and Crypto, Member Exclusive, WTF

WTF is stablecoin?

  • Stablecoin is a kind of cryptocurrency that’s tied to a reserve asset that helps stabilize its market value.
  • Here’s everything you need to know about stablecoin.
close

Email a Friend

WTF is stablecoin?

As of March, stablecoins have reached nearly $40 billion in supply. Earlier this year in January 2021, monthly transaction volume exceeded $200 billion.

Cryptocurrencies have taken up a lot of news coverage over the past seven or eight months, but a lot of the focus has been on Bitcoin. The real story might actually be in stablecoins, which because of their inherent stability, have real potential to seep into everyday financial services. 

As of March, stablecoins have reached nearly $40 billion in supply. Earlier this year in January 2021, monthly transaction volume exceeded $200 billion.

Cryptocurrencies have taken up a lot of news coverage over the past seven or eight months, but a lot of the focus has been on Bitcoin. The real story might actually be in stablecoins, which because of their inherent stability, have real potential to seep into everyday financial services. 

Stablecoins offer a lot of the same benefits as traditional crypto — transparency, security, stability, fast transactions, low fees, and privacy — but it also offers stability, something that cryptos like Bitcoin can’t claim. 

WTF is stablecoin?

Stablecoin is a kind of cryptocurrency that gets its value from an external asset. Companies that issue stablecoins will set up a secure ‘reserve’ of the asset backing the stablecoin, typically in a one-to-one ratio. The reserve can be centralized with a central issuer or financial institution, as is the case with fiat or commodity-based assets, or it can be decentralized.


This content is available exclusively to Tearsheet Outlier members.

Tearsheet Outlier information and signup Missing out? Subscribe today and you’ll receive unlimited access to all Tearsheet content, original research, exclusive webinars and events, member-only newsletters from Tearsheet editors and reporters and much more. Join Outlier now — only $49/mo. Already an Outlier member? Sign in to your account

0 comments on “WTF is stablecoin?”

Outlier OpinionsMakers

WTF

Zeitgeist 2022: Tearsheet’s guide to the financial terms nobody understands

  • There were a lot of disappointments last year. What never failed us, though, was the financial space's ability to invent new words.
  • We've updated our Termsheet for 2022 to help you sound like you know what we're all talking about.
Rebecca Cohen | January 27, 2022
Member Exclusive, WTF

WTF is social commerce?

  • Social commerce is the buying and selling of products on social networking websites and apps.
  • The global social commerce industry is expected to balloon to $604.5 billion by 2027.
Shehzil Zahid | August 05, 2021
Member Exclusive, WTF

WTF is a banking desert?

  • Bank deserts exist in areas without banks.
  • Access to financial services has a sociological and financial impact on people.
Minahil Shahab | June 30, 2021
Member Exclusive, WTF

WTF is a SPAC?

  • Special Purpose Acquisition Companies go public and use the funds to acquire a company after.
  • More investors are becoming fluent in SPAC-speak.
Rivka Abramson | April 30, 2021
Member Exclusive, WTF

WTF is DeFi?

  • DeFi or decentralized finance refers to permission-less and transparent financial ecosystems powered by blockchain networks.
  • DeFi architecture eliminates the need to use financial services under regulation of governmental and financial authorities.
Rimal Farrukh | April 16, 2021
More Articles