Top Relevant Stablecoins In 2023

Stablecoins, which rates do not move up and down, but remain stable and equal to their underlying asset (fiat currency, precious metal, or even another cryptocurrency) are aimed at creating a stable and reliable environment to increase trust in cryptocurrency and eliminate the speculative nature of digital assets.

Tether (USDT) And TrueUSD (TUSD) Are Among The Top -5 Trusted Stablecoins In 2023.

Tether is the first cryptocurrency that achieved stablecoin status in 2014 functioning on various blockchains (Ethereum, Tron, Algorand, EOS, and others.). It is the most capitalized stablecoin. Tether Limited is an issuer of the project can emit tokens without limitations and is responsible for controlling the assets. When demand arises, the Tether team puts a new batch of USDT into circulation. 

Tether is pegged to the US dollar exchange rate at a 1:1 ratio: this means that 1 USDT is worth 1 US dollar.

USDT Pros:

• It’s still the largest stablecoin by total capitalization with excellent liquidity and an existing stock of crypto trust.
• No one knows exactly where exactly Tether’s assets are stored. The recent bankruptcy of Silicon Valley Bank caused the transparent USDC to immediately sag because everyone knew the names of the banks holding its reserves. And the completely opaque USDT, about which one can only guess – where exactly its money is kept, remained rock solid. 

USDT Cons:

• As we mentioned before taking into account that no one knows exactly where Tether’s assets are stored it is not sure they are in a safe place and at some point it could turn out that inside Tether’s reserves, you may find some worthless wrappers instead of real money;
• Tether Holdings Limited is registered offshore in the British Virgin Islands – which strict regulations are causing doubts. Taking into account the fact that Tether’s management has already been caught in the act of lying and dubious actions – there are certain risks of history being repeated.
• We see that American regulators are now tightening their stance towards all crypto assets and stablecoins may be extinguished with a unique fervor.

TUSD appeared in early 2018 and functions on various blockchains (Ethereum, Avalanche, Tron, and others.). It is the same fiat-pegged stablecoin as USDT, backed by a parity-1:1 to the US dollar. The interesting thing is that TUSD vs USDT shows the reserve balances at different banks on its domestic website supposedly in real-time. Every time a user buys US dollars, the equivalent amount is immediately burned. Judging by the quarterly reserves report, the token issuance is handled by a Singapore-based company called Techteryx. The report also states that all reserves are held in escrow accounts with different banks/trusts in the US, Hong Kong, and the Bahamas. 

TUSD Pros:

• You can monitor in real-time in which banks the money in reserves is racing;
• The project emphasizes its full transparency.

TUSD Cons:

• It is not obvious how to assess the reliability of holding funds in offshore banks.
• The small capitalization of the stablecoin means that in the event of a panic, token holders can more easily “raid reserves” – so any small problems with reserves run the risk of growing into a big problem (because assets from all the “decent” places will quickly be taken out through redemption).

In general, stablecoins will obviously play a key role in the global financial system, as they effectively provide practical use of cryptocurrency and have become an important component of the cryptocurrency market. This sphere is actively developing, and although the cases of failures in the industry experts believe that such coins have a promising future. 

Stablecoins as well as any other projects can be bought through a large number of services and exchanged anonymously and unlimitedly on the Godex crypto exchange.

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