Stablecoins are a particular kind of cryptocurrencies whose price remains "stable", i.e. pegged to a fiat currency.
The most used fiat currency for stablecoins is US Dollar, and currently there are a large number of stablecoins which follow its value. Six of them are in the top 100 cryptocurrencies by marketcap, but they differ from each other by some number of aspects.
Let's see them in details.
Tether - USDT
USDT is the most known and most used stablecoin, accepted by almost any exchange and it works on most blockchains.
It is issued by a Hong Kong-based company named Tether.
The connection to USD is made maintaining a sum of dollars in reserves that is equal to the number of USDT in circulation.
Currently there are about 38 billions USDT in the market.
USD Coin - USDC
This stablecoin is owned by The Centre consortium, which has two founding members. One of them is a peer-to-peer payment company named Circle, and the other one is the Coinbase cryptocurrency exchange. Every USDC in circulation is backed up by $1 held in reserve, with a mix of cash and U.S. Treasury bonds.
Its marketcap is about 9 billions $.
USDC is currently the only negotiable stablecoin in Coinbase, together with DAI.
Binance USD - BUSD
Being the most used centralized exchange, BINANCE also introduced a dollar-backed stablecoin in partnership with Paxos.
BUSD was also approved by the New York State Department of Financial Services (NYDFS). It is currently only supported on the Binance exchange.
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BUSD current supply is over 3 billions.
DAI
DAI is based on Ethereum and it's managed by the Maker Protocol and the MakerDAO decentralized autonomous organization.
Unlike the first three stablecoins we saw, the DAI dollar-peg is a soft peg. Recently it went from its single-collateral version (SAI) to its current Multi-Collateral version.
Specifically, DAI uses, as collateral, other cryptocurrencies deposited into smart-contract vaults every time new DAI is minted.
A key advantage of DAI is the fact that it isn't managed by a private company, but, instead, by a DAO via a software protocol.
Its marketcap is about 2.8 billions $.
Paxos Standard - PAX
With a much lower marketcap, we then find PAX, collateralized 1:1 through the USD held in Paxos-owned US bank accounts, similarly to USDT.
Paxos Standard was built with the purpose of improving the financial crypto ecosystem through the creation of a global network.
PAX's marketcap is growing and it's currently around 0.7 billions $.
HUSD
Similary to BUSD, this stablecoin is issued by Stable Universal, in collaboration with the Korean centralized exchange Huobi and maintained through monthly audits conducted by an independent US audit firm. Unlike BUSD, it is available for trading also on other exchanges, like Hotbit.
HUSD has a current supply around 0.5 billions.
Thanks for reading, let me know what do you think about it in the comments and feel free to share your experiences!
