• Dai (DAI): Dai is a decentralized stable coin that is pegged to the USD but also managed algorithmically through a system of collateralized debt positions (CDPs). The value of Dai currency is maintained by a system of incentives and penalties designed to encourage holders to adjust their positions in response to market fluctuations.

• TerraUSD (UST): Terra USD is a decentralized stablecoin that offer a similar method to Dai currency , managing its peggging through a system of algorithmic activities and penalties based on the supply and demand of the token.

Stablecoins can be managed through various ways, depending on their specific kinds . However, the ultimate objective is always to ensure price stabilization and provide a dependable alternative for investors and traders seeking to mitigate risks related to price volatility.

Stablecoins were created as a way to address the volatility and stability of cryptocurrencies such as Bitcoin and Ethereum. Unless these cryptocurrencies, stablecoins are created to maintain a stable currency value, typically pegged to a fiat currency such as the USDor euro.

Stablecoins are beneficial in several ways. Firstly, they provide a way for users to keep hold cryptocurrency without being exposed to the volatility of the market. This makes stablecoins a more wonderful option for those who want to use cryptocurrency for day-to-day transactions or as a store of value.

Secondly, stablecoins can be used to transfer currency quickly and cheaply across borders. Unlike old payment methods that may take days to process plus involve high fees, stablecoins can be transferred fast and with low fees.

I have been using USDT currently , which is a stable coin, to withdraw my steem rewards from two different cryptocurrencies, and also TRX. I usually exchange these rewards for USDT in Binance, a cryptocurrency exchange application . When I receive rewards in Steem or TRX from steemit , I send them to my Binance account, where I can then exchange them for USDT on direct or indirect method . I prefer to use USDT as it allows me to easily convert my steem and TRX rewards into a stable asset that I can hold or use for other purposes.

Binance is a most popular cryptocurrency exchange that offers a wide range of trading pairs , including USDT/STEEM and USDT/TRX. By exchanging my rewards for USDT on Binance, I can fast and easily convert them into a stable coin that I can use for other trades or withdraw to my Easy paisa Account .

Stablecoins are created to maintain a stable price, usually pegged to the US dollar or another valuable asset. However, stablecoins can lose their pegs in certain cases , as discussed below.

• An Algorithmic Failure: Algorithmic stablecoins use a computer algorithm to maintain the pegs and are not sponsor by any asset. Terra Luna (LUNA) currency and TerraUSD (UST) currency maintained each other's prices through a burn/mint balance. However, in May 2021, Anchor, a protocol that allowed users to deposit their UST for rewards, dropped its yield from 20 percent to 4 percent . Investors withdrew their UST and sold , leading to a huge drop in demand for UST currency . Terra Labs, the owners of LUNA and UST, couldn't do anything to menage the drop in demand, which sealed at movement the fate of both cryptocurrencies.

• Lack of Over-Collateralization: Stablecoins often need over-collateralization to hold an mentain their pegs. MakerDAO is a borrowing and lending platform that uses the Dai stablecoin (pegged to the USd). MakerDAO has a collateralization ratio of 150 percent , meaning that for every dollar worth of DAI borrowed, $1.50 of another crypto must be deposited.

• A Market Ripple Effect: Confidence and trust are both important for stablecoins, and lack of trust can lead to market crashes. When LUNA and UST crashed due to a massive drop in demand of , the rest of the crypto industry became nervous at time . This more or less affected every cryptocurrency in the game of crash , including Tether, the market's most popular stablecoin, which shake significantly.

Advantages Explained:

Borderless Payments: Stablecoins offer countless payments, allowing for direct and unchangable transactions that cannot be blocked or censored.

Low Fees: Stablecoins also offer low fees due to the lack of intermediaries and their P2P nature, making them a inexpensive option than traditional transactions of funds.

Quick Transactions: Stablecoins offer quick transactions due to the absence of intermediaries and waiting periods, making transactions faster compared to traditional ones.

Transparency: Stablecoin transactions are based on public blockchains, making it possible for users to monitor each transaction in transparent way , providing the much-needed transparency that traditional payments methods lack.

Disadvantages Explained:

Centralization: The maximum of stablecoins are owned by an individual organization, making them centralized and creating another form of ownership similar to what banks currently have.

Dependence On Traditional Financial Markets: Stablecoins are mainly pegged to fiat currencies, making their value dependent on the current condition of the global economy that subject to inflation, which FIAT currencies have.

Regulation: The irreregulation in the field is a disadvantage for all cryptocurrencies , including stablecoins, as there is a long way for them to groom into what they are intended to be and to function as a means of transacting.