Top 10 Algorithmic Stablecoins that Won’t Take Terra’s Route


Algorithmic stablecoins can sometimes be unstable too, and TerraUSD is a major example.

Cryptocurrencies are infamous for their volatility, they can rise up and down exponentially but stablecoins are supposed to remain pegged to a particular currency. This is one of the many reasons why stablecoins are considered some of the safest options for investments for those trying to avoid the volatility of the crypto market. But quite unexpectedly, the TerraUSD token ‘de-pegged’ from the dollar, bringing down the overall value of the Terra ecosystem, and wiped out 95% of the investors’ wealth overnight. Terra’s fall not only caused investors to lose faith in the cryptocurrencies but also made them realize that no matter how secure a crypto investment might seem, all digital assets are volatile. One of the many reasons why experts think that TerraUSD crashed is because it is an algorithmic stablecoin. And as reports have stated, algorithmic stablecoins pose serious threats to investors’ wealth and profits. In this article, we have enlisted the top algorithmic stablecoins that are not expected to take Terra’s route and drown the crypto community.

 

Dai

Dai is an Ethereum-based stablecoin whose issuance and development are managed by the Maker Protocol and the MakerDAO decentralized autonomous organization. The price of Dai is soft-pegged to the US dollar and is collateralized by a mix of several other cryptocurrencies that are deposited into smart contract vaults every time a new Dai is minted.

 

Magic Internet Money

Magic Internet Money is one of the many algorithmic stablecoins that are being offered by some of the major cryptocurrency exchanges in the world like Uniswap, PancakeSwap, and Curve Finance. Users can deposit interest-bearing assets on the abracadabra. money, and use those as collateral to borrow the stablecoin MIM.

 

Frax

Frax Protocol is one of the first-algorithmic stablecoin systems. Frax is open-source, permissionless, and entirely on-chain which is currently implemented on Ethereum. The end goal of the Frax protocol is to provide highly scalable, decentralized, algorithmic money in place of fixed-supply digital assets like BTC.

 

Neutrino USD

Neutrino USD is an algorithmic crypto-collateralized stablecoin pegged to the US dollar. All operations including USDN such as issuance, collateralization, staking, and reward payouts are transparent and governed by smart contracts.

 

MAI

MAI is one of those algorithmic stablecoins that are harder to obtain and are only found on the Coinbase app and Coinbase wallet. Mimatic stablecoin is collateralized with Matic tokens.

 

Tribe

Tribe is a governance token for the FEI algorithmic stablecoin. Fei aims to provide new decentralized solutions to the stablecoin market. TRIBE is the governance token of the DAO controlling the governance of FEI and can be used in governance proposals or swapped for FEI in a UniSwapV2 liquidity pool.

 

Ampleforth

Ampleforth is an Ethereum-based cryptocurrency with an algorithmically adjusted circulating supply. It is designed to the base money of the new decentralized economy by providing an asset that cannot be diluted by supply inflation and remains decoupled to the price action of other cryptocurrencies like Bitcoin.

 

USDX

USDX is the crypto-backed native stablecoin of the Kava DeFi world. According to its developers, any interest, irrespective of their geographical location can deposit digital assets as collateral on Kava and utilize that to balance and mint USDX tokens.

 

USDD

USDD is a crypto that is issued by the TRON DAO Reserve with a stable price and diverse use cases. It has a built-in incentive mechanism and a responsive monetary policy, which will allow USDD to self-stabilize against price fluctuations, and help maintain the value of USDD as a true settlement currency.

 

Parallel

PAR is a stablecoin that is algorithmically pegged to the Euro. It is exclusively minted in relation to loans on Mimo DeFi, which is its lending platform. PAR tokens are, hence, collateralized by assets accepted on Mimo DeFi.

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