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A guide to the top 3 stablecoins by market capitalization, as the debate rages whether these tokens are the future of crypto or unregulated 'poker chips'

A guide to the top 3 stablecoins by market capitalization, as the debate rages whether these tokens are the future of crypto or unregulated 'poker chips'

Tether, USD Coin, and Dai are the three largest stablecoins by market capitalization, according to the price-tracking website CoinMarketCap.
Muhammed Akan/Shutterstock




Stablecoins are crypto tokens pegged to a fiat currency or a commodity, giving them a relatively stable price.




They are less volatile than bitcoin and play an important role in decentralized finance.




But regulatory bodies have raised concerns about stablecoins like tether, which is the largest by market capitalization.


Stablecoins are causing one of the hottest debates in crypto right now. While advocates envision them overtaking bitcoin and leading the decentralized finance transition, detractors have questioned the lack of regulation in the sector.Unlike other cryptocurrencies, these tokens derive their value from being pegged to another asset. This could be a fiat currency, such as dollars or euros, or a commodity, like gold or silver.Stablecoins appeal to investors, because those pegs make them much less volatile than other cryptocurrencies. Bitcoin's price has fluctuated between a low of $29,000 and an all-time high of almost $70,000 this year. Tether, the largest stablecoin by market capitalization, posted a low of $0.99 and a high of $1.01.Many more cautious investors, including big-hitters like Warren Buffett, have criticized crypto because of its extreme volatility; in theory, stablecoins offer them a steadier route into the industry. Another way into the mainstream could be the creation of Central Bank Digital Currencies (CBDCs), such as China's digital yuan project.
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