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Stable coins have managed to gain fame over the past 2 years. Even though they might not offer attractive returns on investment like Bitcoin and several other alternate coins, they are completely safe from the entire volatility factor for which the cryptocurrency market is very famous. Irrespective of whatever might happen on a given day in the cryptocurrency market, it does not affect any stable coin prices since it is pegged to an underlying asset and only moves with the increase/decrease in the prices of that underlying asset.
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Understanding the world of stable coins and differentiating them with Bitcoin and alternate coins
Stable coins have managed to gain fame over the past 2 years. Even though they might not offer attractive returns on investment like Bitcoin and several other alternate coins, they are completely safe from the entire volatility factor for which the cryptocurrency market is very famous. Irrespective of whatever might happen on a given day in the cryptocurrency market, it does not affect any stable coin prices since it is pegged to an underlying asset and only moves with the increase/decrease in the prices of that underlying asset. There are several kind of stable coins which are linked to different assets.
A few such examples of stable coins are Tether which is linked to the US Dollar, QCAD which is linked to the Canadian Dollar and so on. If you are interested in investing into stable coins and are wondering how to buy Tether in Canada then stay tuned. This article will help you understand stable coins and some of the use cases of these coins.
Let’s get startedWhy would someone invest in stable coins when there are coins like Bitcoin and Ethereum offering massive returns on investment?This is a question which is very common among investors, stable coins are awesome investment choices for those investors with a less risk appetite. Coins like Bitcoin and Ethereum are great investments but due to their volatility factor they are not considered by any safe investors.
Stable coins can be accumulated and loaned to several exchanges and financial institutions and in return you earn a certain fixed percentage of returns every year and that is a win-win situation for any investor who wants the best of cryptocurrencies but does not like the volatility aspect of it. Stable coins work in the same decentralised manner as other cryptos and offer the same fundamentals as Bitcoin or any other cryptocurrency.
What are some of the use cases of these stable coins?Stable coins are now majorly used in Decentralised Finance(DeFi) and Decentralised Exchanges(DEX). They are the sole medium used to provide any loans or borrow any money in the DeFi system since their prices do not fluctuate a lot. They are also used as mediums of exchanges on DEX’s to buy other cryptocurrencies with the help of smart contracts. There are several other use cases to stable coins but we can leave that discussion for another time.
What other options do I have in the cryptocurrency market and how do I get started?There are several other options such as Bitcoin and Alternate coins such as Ethereum, Litecoin etc. If you are an investor who has a good appetite for risk then you can definitely consider investing into these coins for massive returns over the long term. If you are wondering how to “buy Litecoin Canada” or buy stable coins then all you need to do is visit the Netcoins website and follow the instructions stated there to get started.SOURCE CREDIT: https://netcoinscanada.wordpress.com/2021/09/13/understanding-the-world-of-stable-coins-and-differentiating-them-with-bitcoin-and-alternate-coins/
