Understanding Stable Currency and its Growing Market Value

According to reports, according to CoinGecko data, the current total market value of stable currency is 134.6 billion US dollars. Among them, the market value of USDT was 79.4 billion US dollars, with a market value increase of 12.4% in the past 30 days; The market value of USDC was $34 billion, down 19.0% in the past 30 days; BNB’s market value was $8 billion, down 32.9% in the past 30 days.

Currently, the total market value of stable currency is 134.6 billion US dollars, and the market value of USDT has increased by 12.4% in the past 30 days

Stable currencies are often referred to as a reliable alternative to traditional currencies, which tend to have higher fluctuations compared to those of stable coins. As per CoinGecko data, the total market value of stable currency stands at a whopping $134.6 billion US dollars. Amongst the stable currencies, USDT has a market value of $79.4 billion, which is up by 12.4% over the last 30 days. USDC has a market value of $34 billion, but it has seen a decline of 19.0% in the past 30 days, and BNB stands at $8 billion, which declined by 32.9% in the past month. In this article, we will discuss in-depth what stable currency is and what makes it a reliable alternative to traditional currencies.

What is Stable Currency?

Stable coins or currencies are a form of digital currency that’s linked to tangible assets such as gold or the US dollar. They eliminate the volatility present in cryptocurrencies like bitcoin by maintaining a fixed value, which helps stabilize its value. This stability is possible because of the link that stable currencies have with other stable assets; this makes them a desirable alternative to traditional cryptocurrencies.

How Stable Currency Works?

Stable currency is backed by some reserve asset, and usually, it is fiat currency like the US dollar or Euro. Therefore it is pegged to another stable asset. When the price of the stable asset rises, then the computer algorithms control the supply by creating more stable coins, which results in an increase in the circulating supply, ensuring that these coins remain relatively stable in the market.

Benefits of Stable Currency

Stable currencies are gaining popularity due to their ability to bring different benefits to the forefront. These benefits include:

Lesser Volatility

As we mentioned earlier, stable currency aims to remove volatility that traditional cryptocurrencies face. This makes it a safer investment option and reduces the risk that investors face.

Transparency

Since stable currency is pegged to traditional currencies, it has more stability, and transparency is key. The amount of money that’s put into reserves is audited by third-party regulators, which ensures that the value of the underlying asset supports the stable currency’s value.

Quick Transactions

Stable currency transactions are faster and cheaper than traditional banking because most of the transfer occurs on a blockchain. This means that there are fewer intermediaries involved, which makes transactions quicker and cheaper.

Conclusion

Stable currency has a well-defined role in the market and offers plenty of benefits compared to traditional currencies. These benefits have helped it build a community of investors who are looking for a more reliable and predictable form of investment. Even with its popularity, it’s still critical to do due diligence before investing in stable currency to ensure that it aligns with your investment goals and strategy.

FAQs

1. How do I convert my stable currency to traditional currency?

Most stable currencies can be easily converted to traditional currency from the platform where you bought them. The platform usually provides a conversion option along with a wallet to store your digital coins.

2. Can Stable coins be traded like other cryptocurrencies?

Yes, stable coins can be traded on cryptocurrency exchanges just like any other cryptocurrencies. However, their value remains relatively stable compared to their counterparts.

3. What are the risks associated with investing in stable currencies?

The main risks associated with investing in stable currencies include a change in the underlying asset’s value and the trustworthiness of the issuer. Therefore it’s vital to do due diligence before investing in a specific stable currency.
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