S4B Crypto Contest - Season 16

INTRODUCTION

Hello everyone...
Greetings to you all...
I personally welcome you all to my blog,
I'm @ibraheem75
From Nigeria,
I'm so delighted to participate on this wonderful contest titled: S4B Crypto Contest - Season 16 organized by my mentor @waqarahmadshah in this great and wonderful of Steem4Bloggers community, it's a pleasure to be here and to also participate on this contest.

✅What is a stablecoin?

Freepik
A stablecoin is a kind of cryptocurrency that is developed to maintain and ensure a steady value, that is often linked, connected or subjected to a traditional currency like the American Dollar or some other valuable amounts or resources like the Gold. One good thing about stablecoin is that is unpredictable and is so so good for our day-to-day financial transactions without any deficit.

✅How do stablecoins maintain their value?

Stablecoin maintains their value through so many ways and means depending on the amount, transactions or a type of stablecoin involved,below are some other ways of how they maintained their value;

• Price Stabilization Mechanism; This has to do with a system of maintaining a stable prices system and how to interchange the rate of each supply of stablecoin in other to meet up with the world bank system or central bank terms and conditions,

• Fiat-backed: This is concern with the support render by the traditional currency like the US dollar which I earlier mentioned, for the increase in the value system,

• Resources-backed: This also has to do with the use of availability of resources required or commodity like the Gold and other resources to ensure the value is highly maintained,

And lastly on my list here is the act of using combined mechanism to achieve it great success, or using different kind of approach to ensure it stabilization depending on the market conditions, so that the value most be sustain.

✅What are the main uses of stablecoins?

Freepik
There are so many uses of stablecoin, below are some few viz;

• For Trading and investment: The stablecoin has provided a lot of opportunities or services for people out there to engage on cryptocurrencies investment without any feelings of price volatility,

• E- Transactions: Stablecoin has provided lot of services for people like me in particular to engage in online transactions via cryptocurrency with zero concern on the price variation with credibility.

• Lastly is the Reserve assets: Stablecoin provides good avenue for every individual around the world to store his/her value without have to worry about the market changes,

✅How do stablecoins affect cryptocurrency market liquidity?

Freepik
Stablecoin has rapidly improved cryptocurrency market liquidity with my following points ;

• It reduces price volatility; Stablecoin has increasingly reduced so many price variations in the crypto world, making is easier for investors to buy and sell their valuable assets, thereby increase the economy stability,

• It also improves market depth by providing a constant avenue for buyers and sellers to trade upon without any deficit or barriers,

• It provides Market arbitration opportunities for every individual to explore to other price changes which lead to it increase in liquidity,

• Lastly on my list is the total increase in the market, whereby the stablecoin provides quick solutions that allows competitors to excel, by also increase the trading Abilities and liquidity in the crypto world.

That's all I have to say for now, though there are many more to say,
In this regards if stablecoin is properly maintained it would be of an increase in the global market of world crypto non-stop, but if not? You all know the results.

Thank you everyone for taking your time to read through my post, I sincerely love you all.
Steemit..... One💖

My invites
@dave-hanny
@echuku
@ajegena

Best regards @ibraheem75.

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