Members of Congress are working to legislate guardrails for stablecoins, a unique form of cryptocurrency.
While a relatively new concept, stablecoins have exploded in popularity, leading lawmakers to seek regulation. Here’s what to know.
What stablecoins are
Stablecoins, while a form of cryptocurrency, differ in some major respects from traditional crypto assets, such as bitcoin and ether. The biggest difference is that while traditional cryptocurrencies can fluctuate wildly in price, that is not supposed to be the case with stablecoins.
For instance, in the past month, the value of one bitcoin has fluctuated between below $62,000 and as high as $73,000 — a difference of nearly 18%. On the other hand, stablecoins, such as Tether, USDC, and Dai, the three largest stablecoins by market capitalization, remain pegged at $1.
Stablecoins, which now make up a multibillion-dollar market, tie their
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