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Top Stablecoins to Use in 2023
Stablecoins are virtual currencies that help minimize crypto market volatility. These crypto-assets are often pegged to the value of fiat money, exchange-traded commodities like gold and silver, or cryptocurrency. These tokens operate on blockchain technology and offer investors more safety than other crypto assets.
Over the years, stablecoins have increasingly brewed up a storm in the crypto space. For instance, most of them chose the US Dollar as the primary asset to peg their value and reach global acceptance.
Nevertheless, not all stablecoins are the same. They come in different sizes and shapes. And some of them have distinct backing assets, intrinsic values, and many other features. This article looks at the top stablecoins of 2023 and their most popular trading platforms.
What Are the Top Stablecoins to Watch in 2023?
The section below will discuss the top contenders in the stablecoins space for 2023.
1. Tether (USDT)
This coin’s name stems from “tethering itself” to the US dollar value. Tether is the most popular stablecoin in the crypto space. Also, it is the first significant token that investors and crypto exchanges adopted.
Tether (USDT) has the backing of traditional currency, commodities like gold and silver, and cash equivalents. Moreover, its smooth integration with cryptocurrency to fiat money platforms has made this stablecoin a favorite among numerous investors.
USDT has a market cap of over $66 billion. The stablecoin is the 3rd largest cryptocurrency and has a market price of $1. However, USDT may sometimes vary between 91 cents to a little above a dollar. The guarantor of this token is the Bank of Hong Kong, with vast user funds. In addition, the Omni Layer Protocol manages this coin’s output, demand tracking, and liquidation.
2. TrueUSD (TUSD)
True USD (TUSD) launched in 2018, the crypto industry’s first 100% USD-backed stablecoin. It is transparent and reliable, and many consider it the best hedge against crypto market volatility. To this end, many experts believe that this asset is the market’s most independent and manageable cryptocurrency.
The token features a ratio of 1:1 against the dollar. In turn, its collateral funds are in third-party storage. Also, the money goes to the trust institution.
Furthermore, its creators do not participate in the transfer and have no access. The release of these funds takes place using smart contracts upon request by the customers.
True USD operates on the TrustToken platform. At the time of writing, it had a market cap of about $850M with a market price of $0.999940. Also, this token features low transaction costs, high-interest rates on capital balance, and maintains high data transparency.
3. USD Coin (USDC)
USD Coin anchors its value to USD and operates on various blockchains, including Algorand, Ethereum, Solana, and Stellar. It works on CENTRE technology and first appeared as a joint effort by Coinbase and Circle. The coin is famous for its transparent auditing techniques and fast and secure transactions.
Additionally, it is a crypto-backed stablecoin. Its fund reserves remain in FDIC-insured US banks. Also, the New York State Department of Financial Services regulates it to protect customers and other investors.
With a market cap of $44 billion and a market price of $1.00, USDC has a 1:1 ratio with USD. Furthermore, it does not charge users fees when redeeming or creating these tokens. In turn, they offer an excellent way to trade an asset. This is possible due to its underlying US dollar reserve and monthly market supply of tokens.
4. Paxos Standard (PAX Dollar – USDP)
Paxos Standard (USDP) is a popular fiat-backed stablecoin operating on the Ethereum network. Many experts believe it to be the best fiat collateralized token to eliminate cross-border transaction fees.
A New York-regulated financial institution, Paxos, developed this token and held its USD reserve 1:1 in Paxos-owned US Banks.
Wall Street regulators widely accept this token and consider it a reliable crypto asset. For instance, it aids in improving the traditional financial industry. In addition, it achieves a frictionless global network and generates a virtual asset with more flexibility and speed.
Furthermore, USDP has a market cap of $876 million and holds a market price of $1.00. It has a daily trading volume of $2M at the time of writing.
5. Binance USD (BUSD)
In collaboration with Paxos, Binance launched Binance USD (BUSD) in 2019. This stablecoin is a virtual dollar-backed with a ratio of 1:1 to US dollars. The New York State Department of Financial Services regulates it, and FDIC-insured banks store its reserves.
A reputable audit firm audits it every month to verify the authenticity and compliance of the reserves. Many users prefer it due to its stable and reliable value. Furthermore, investors can hold BUSD as a hedge against crypto market volatility and fiat money devaluations. Lastly, they can also use and trade it in the DeFi markets for lending and borrowing.
With a live price of $1 and a market cap of $16 billion, Binance USD has a 24-hour daily trading volume of $9B. Currently, this token ranks as the 7th largest cryptocurrency in the market.
Conclusion – Top Stablecoins to Watch in 2023
Stablecoins are an excellent way to diversify your cryptocurrency investment. They offer a stable trading means and protect investors and traders from steady crypto market volatility.
The market already contains numerous stablecoins. Also, many more are in development. So, choosing the best stablecoin to add to your investment portfolio can be overwhelming. However, regardless of your choice, do your due diligence before opening your crypto wallet.