How Stable Are Stablecoins, Really?
Recent events in the cryptocurrency sector may have made you doubt what so-called stablecoins are good for.
Sure, it's handy to keep a digital coin around that can act as a stand-in for the U.S. dollar (or another major world currency) as needed. A trading system built to manage blockchain-based cryptocurrencies must run smoother using a crypto-style replacement for ordinary currencies, so it makes sense that most of the leading stablecoins were created by, and used in, the world's largest cryptocurrency trading services.
But that's only true as long as the stablecoins are stable. When one of these dollar substitutes loses its connection to the currency it is supposed to be firmly pegged to, the related trading system can fail in a hurry.
Source Fool.com
