[Image: Stable Kwon and his stable bags]
I still remember those days when the biggest live Youtuber — Crypto Banter, tell all his subscribers to change their stablecoin holding to Terra UST. I was their loyal audience at that time, but I didn't follow their call to action simply because I was too lazy to swap stablecoin. That's how I dodge a bullet; my procrastination saved me.
UST has changed all our lives in some way. After the tragic de-pegging event, one question lingers in our mind: "Are stablecoins safe? If so, which stablecoin is the safest?" I know we all have contemplated those questions as the slight de-pegging of USDT that happened soon after the death of UST proved it. We're all vulnerable to mass hysteria and extrapolating to the wrong sentiment, which causes the USDT FUD to resurface again for god knows how many hundredth times at this point. Because I knew USDT FUD would occur every few months, I swapped my BUSD to USDT while It was de-pegged and earned a few basis points when everything returned to normal again. Was I confident? Nah, I was shaking. That's how much we're prone to collective panic and fear.
The Best Stablecoin
Unfortunately, there's probably no "best" stablecoin. If there's a best out there, market liquidity will probably flood to it already, and so far, we know USDT is not the best. To save time for me and you, I outlined a few promising stablecoins below (in point form):
USDT
Issuer: Tether Limited Inc.
Type: Asset-backed stablecoin
Market cap: $66 billion
Good: large liquidity, long history, since 2014
Bad: not as "transparent" as another stablecoin
USDC
Issuer: Centre Consortium
Type: Asset-backed stablecoin
Market cap: $55 billion
Good: best stablecoin in terms of credibility and transparency
Bad: fewer trading pairs available in CEX.
DAI
Issuer: MakerDAO
Type: Over collateralized stablecoin
Market cap: $6.9 billion
Good: decentralized, over-collateralized (good for the safety of your pocket)
Bad: decentralized (proned to hacks and exploits) over-collateralized (bad for the market)
BUSD
Issuer: Paxos Trust and Binance
Type: Asset-backed stablecoin
Market cap: $17.8 billion
Good: Convenient to use in Binance, monthly audit report from Paxos
Bad: Tied to the survival of the private company, Binance
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I really like BUSD, because Binance is great platform and I believe in Binance also CZ is a great guy. But at last no stablecoin is perfect.
Great information! Thanks for sharing.