Stablecoins are more important than many beginners can understand. Tether, USDC, and others offer stability and security, as well as being cryptographic assets
.
Although they don’t have high earning prospects, stablecoins are an integral part of every investor’s portfolio for several reasons. As the name suggests, stablecoins are relatively stable cryptocurrencies. While the price of other cryptocurrencies can fluctuate considerably based on various factors, stablecoins maintain their value by anchoring themselves to assets such as the US dollar or gold,
thus offering greater stability.
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Why buy stablecoin?
Stablecoins are perfect for those who want to keep their money or private transactions away from prying eyes. Thanks to their stability, users prefer to store money in these cryptocurrencies without having to worry about price fluctuations. In addition, they are an excellent means of carrying out international transactions, since they do not involve the high transaction fees typical of banks and money transfer apps
.
In addition, some DeFi apps and cryptocurrency exchanges require users to own stablecoins to buy the cryptocurrencies to trade. Users can use stablecoins as fiat currency and exchange them for their desired crypto assets
.
The 5 best stablecoins for your cryptocurrency investment
Stablecoins hold a significant share in the cryptocurrency market, and several platforms have launched their own versions, offering multiple options to investors. The combined market capitalization of stablecoins is around 161.5 billion dollars, with a trading volume of 64.4 billion
dollars.
There are various types of stablecoins based on their methods of operation and anchoring. Despite this, they offer almost the same functionality. So let’s explore the 5 best stablecoins that can be the perfect companion for your cryptocurrency investment in June
.
1. Tether (USDT)
Launched in 2014, Tether is the leading stablecoin by market capitalization, with 112 billion dollars. In addition, it is ranked third on CoinMarketCap after bitcoin and Ethereum, demonstrating its demand in the market. Tether offers pegged to various fiat currencies, but USDT pegged to the US dollar is the most powerful. At the time of writing, the price of USDT is equivalent to $0.993
.
2. USDC (USDC
)
The USDC stablecoin is pegged to the US dollar at a ratio of 1:1, which means that 1 USDC is always equivalent to $1. Each USDC is backed by physical money (cash or U.S. Treasury bonds) held in reserve to maintain this relationship. It is the sixth largest cryptocurrency by market capitalization, with $32,376,024,662
.
3. Give (DAI)
DAI is an ethereum-based stablecoin whose value is pegged to the US dollar. However, the value is managed through smart contracts instead of being held in the form of physical money in reserve. At the time of writing, DAI’s price is $0.999, with a market capitalization of $5,347,150,316, ranking 24th in the ranking by cryptocurrency
market capitalization.
4. First Digital USD (FDUSD
)
FDUSD is valued at $0.9983 and is ranked 38th by market capitalization with $2,899,317,794. It’s another example of a stablecoin whose value is pegged to the U.S. dollar for stability and security. This stablecoin can be programmed for financial contracts, insurance, and escrow
without involving third parties.
5. USDD
Tron DAO is behind this stablecoin, whose value is pegged to the US dollar. In addition, it is backed by other cryptocurrencies such as TRON, bitcoin and Ethereum instead of cash or smart contracts. Tron DAO guarantees the storage of supporting cryptocurrencies in amounts greater than the value of USDD to ensure that the instability of the supporting cryptocurrencies does not affect the stablecoin. At the time of writing, 1 USDD equals $0.9979 and has a market cap of
$730,211,025.
There are hundreds of other stablecoins with different anchoring modes and security promises. This article concluded with the five largest and most popular stablecoins, which have a high acceptance rate and offer maximum stability compared to the
others.
