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Difference between revisions of "Stablecoin"
→Algorithmic stablecoins
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For example the UST stablecoin issued on the Terra blockchain is always redeemable for 1 USD worth of LUNA tokens and LUNA is burnable to mint an amount of UST equal to the USD worth of LUNA burned. | For example the UST stablecoin issued on the Terra blockchain is always redeemable for 1 USD worth of LUNA tokens and LUNA is burnable to mint an amount of UST equal to the USD worth of LUNA burned. | ||
Since the peg is mainteined through arbitrage and not through backing these stablecoins are more volatile and more subject to depeg events than other types described above. | Since the peg is mainteined through arbitrage and not through backing these stablecoins are more volatile and more subject to depeg events than other types described above. | ||
Several DeFi protocols have issued their algorithmic stablecoin and many have failed (see the Iron Finance crash<ref>https://rekt.news/iron-finance-rekt/</ref> for example) and many are still used today (like UST or USDN). | |||