Stablecoin Glossary
Stablecoin Collateral
Stablecoin collateral refers to assets pledged or locked to support the issuance of stablecoins.
Explanation
Collateral may consist of fiat reserves, government securities, cryptocurrencies, or other financial assets. In decentralized systems, collateral is typically held in smart contracts.
Why it matters
The quality and volatility of collateral influence the stability and risk profile of a stablecoin.
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