The value of digital assets known as stablecoins is pegged to an external asset, such as gold or fiat currency, leading to their early reputation for reliability.
"Stablecoins fill a very important role in the digital asset ecosystem," says Mauricio Di Bartolomeo, chief strategy officer and co-founder of cryptocurrency lender Ledn.
USD Coin (USDC)
Di Bartolomeo calls USDC "the best stablecoin in the market right now in terms of integrity and transparency."
The only decentralized stablecoin available on the market so far is Dai
(DAI), meaning that it is algorithmic and isn't backed by any central authority.
Binance USD (BUSD)
The biggest problem that dollar-pegged Binance USD
could face, according to Di Bartolomeo, is that it's attached to a particular crypto exchange, Binance.
Pax Dollar (USDP)
Paxos as a company is "probably second or third on the list after Circle to get its dollars in the good books of regulators," says Di Bartolomeo.
TrueUSD is a "reputable operator," says Di Bartolomeo. The reputation of a stablecoin's operator is more important than market cap and liquidity, he says.
Digix Gold Token (DGX)
Besides the U.S. dollar, gold has been used to back stablecoins. One of the best current bets for a gold-backed stablecoin is Digix Gold Token (DGX).