A stablecoin is a crypto token designed to hold a steady value, usually one US dollar. USDT and USDC are the best known.
Why they're popular on P2P
Because the price barely moves, neither side has to worry about the market shifting during the minutes a trade takes. Many people in countries with weak currencies also use them as a way to hold dollars.
The risks
- Issuer risk. A stablecoin depends on the company behind it and on the reserves it holds.
- Loss of peg. Prices can slip below a dollar during periods of stress.
- Freezing. Major issuers can freeze tokens at specific addresses.
