Once again this year, we would like to sweeten the Advent season for our readers with an Advent calendar. In a slightly different form, each door contains a “knowledge bomb”, which will be supplemented with an extraordinary special prize on Christmas Day.
Behind the seventh door is the term “Stablecoin”. To enter the giveaway on the 24th, simply take part in the polls and like the respective Twitter posts.
Stablecoin
Tokens linked to fiat currencies are a significant pillar in the crypto ecosystem. So-called stablecoins appear as components in the most important currency pairs and are used extensively on various centralized and decentralized financial platforms. In addition, dollar-denominated tokens offer advantages in cross-border payments compared to traditional alternatives.
Stablecoins are cryptocurrencies whose price is linked to a reference value. The reference value can be fiat money, exchange-traded commodities (such as precious or industrial metals) or a cryptocurrency.
Generally, there are three types of stablecoins: Centralized fiat-backed (1:1), decentralized over-collateralized with cryptocurrencies, and algorithmic stablecoins – with the latter suffering a fatal setback this year. A lot has happened this year, particularly in the area of regulation of these digital fiat currencies. Authorities around the globe are working on comprehensive regulations that should encourage issuers to be more transparent through disclosure requirements.
