<h1 class="ql-align-center">Stablecoin</h1> <h2>Context:</h2> <ul><li>The US is discussing launching a&nbsp;formal review into whether Tether and other&nbsp;stablecoin&nbsp;threaten&nbsp;financial stability.</li></ul> <h2>About:</h2> <ul><li>A stablecoin is a type of cryptocurrency that is typically pegged to an existing government-backed currency.</li></ul> <ul><li class="ql-indent-1">A cryptocurrency is a type of digital asset that is based on a network that spans a huge number of computers.</li></ul> <ul><li>The majority of the dozens of stablecoins that currently exist use the dollar as their benchmark asset, but many are also pegged to other fiat currencies issued by governments like the euro and yen.</li></ul> <ul><li>As a result, the price of stablecoins fluctuates very little, unlike high-profile cryptocurrencies like bitcoin and ethereum that are prone to sudden ups and downs.</li></ul> <ul><li>Stablecoins are useful because they allow people to transact more seamlessly in cryptocurrencies that function as investments, such as Bitcoin.</li></ul> <ul><li>They form a bridge between old-world money and new-world crypto.</li></ul> <ul><li>The first stablecoin, created in 2014, was Tether, which many other stablecoins are modeled after.</li></ul> <img src="https://sunyaias-resources.s3.ap-south-1.amazonaws.com/content/62812962-4b0e-11ec-8349-9d2af53a8eac.png">