Stablecoin

A stablecoin is a token designed to hold a fixed value, usually one dollar, backed by reserves, by crypto collateral, or by an algorithm. The backing is everything: fiat-backed coins are effectively unregulated money market funds, and their reserve disclosures matter more than any technology. Algorithmic designs have failed repeatedly, most spectacularly Terra's UST, which lost $40bn of value in days in 2022.