If you were asked to describe crypto, chances are one of the first words that would come to mind is volatile. Perhaps even unstable. And that would be a fair assessment. Despite their potential, most cryptocurrencies are known for extreme price swings, gaining (or losing) double digits in a matter of days. That makes them exciting for speculation, but less practical for real-world transactions or cash management. Stablecoins aim to solve that problem. As the name implies, these digital assets are designed to be a more stable, functional foundation for the crypto ecosystem. Let’s explore how stablecoins work, what enables their stability, and the different types you’re most likely to encounter — along with the uncertainty still surrounding their role. What Is a Stablecoin? A stablecoin is a type of cryptocurrency that, ideally, maintains its value in order to serve as a reliable medium of exchange, store of value, and unit of an account that doesn’t fluctuate wildly day to day. Typically, a stablecoin attempts to achieve this by pegging its price to a stable asset like the US dollar. In short, stablecoins introduce price