Critics see risk in ‘algorithmic’ stablecoins

An algorithmic stablecoin called TerraUSD is now the third-largest stablecoin by market value, according to sites that track such value. — dpa

WASHINGTON: A new type of digital asset called an algorithmic stablecoin is gaining steam among crypto-enthusiasts — and drawing steam among critics, who warn its risks are in plain sight.

Algorithmic stablecoins use market incentives, controlled by the algorithms that give the cryptocurrency its name, to maintain a stable price against a currency such as the dollar, rather than backing the price with assets like cash or Treasury securities, as other stablecoins do.

Subscribe now to our Premium Plan for an ad-free and unlimited reading experience!

Next In Tech News

AT&T bets on new technology to build US telecom network
GM Cruise may face fines for 'misleading' regulator over accident
Deutsche Bank to review Postbank tech migration - Handelsblatt
Intel wins US appeal to overturn $2.18 billion VLSI patent verdict
Twilio to cut about 5% of total workforce
Caterpillar invests in tech startup Nth Cycle to boost recycling
Verizon announces Netflix, Max streaming bundle for customers
Crypto stocks surge as bitcoin hits fresh 2023 high
Foxconn and Pegatron halt Indian iPhone output due to extreme weather -sources
Intel, Siemens to collaborate on improving manufacturing, energy efficiency

Others Also Read