Stablecoins have drawn a lot of attention, amid the TerraUSD stablecoin ($UST) crash in May 2022, which wiped out $42 billion for $UST and $LUNA holders.
That being said, several stablecoins have continued to maintain their peg to the dollar, remaining stable as intended.
These include reserve-asset stablecoins such as:
- USDC
- USDT
- BUSD
- A fourth one is cUSD, which has an algorithmic mechanism supported by a basket of other cryptocurrencies
All the 4 stablecoins are available to Africans across reputable exchanges.
$USDC
USD Coin ($USDC) was launched in 2018 by Centre, a consortium founded by Circle and Coinbase. It was created to be a regulated stablecoin that ‘works within U.S. money transmission laws and regulations’ while running on blockchain technology.
Like other collateralized stablecoins, $USDC’s value is pegged to the U.S. dollar. That means that one $USDC should ideally always be worth one dollar.
$USDC is natively supported on multiple layer 1 blockchains including:
- Ethereum as an ERC-20 token
- Algorand as an ASA token
- Solana as a SPL token
- TRON as an TRC-20 token
- Stellar as a native asset
$USDC as one of the major stablecoins is available for purchase on major exchanges including Binance, also accessible to Africans.
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SEE ALSO: How Stablecoins are Helping Absorb the Nigeria Crypto Regulation Shock
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$BUSD
Binance USD ($BUSD) is a regulated, fiat-backed stablecoin pegged to the U.S. dollar. For every unit of BUSD, there is one U.S. dollar held in reserve. In other words, the supply of $BUSD is pegged to the U.S. dollar at a 1:1 ratio. Holders can swap their tokens for fiat and vice versa.
Paxos, the token’s issuer, releases monthly attestations of BUSD’s reserves.
As a stablecoin, $BUSD is designed to maintain a stable market value. It allows investors and traders to hold a low-volatility asset on the blockchain without the need to exit the crypto space.
Binance offers several ways to purchase this stablecoin:
- Purchase $BUSD with cash
- You can convert other stablecoins for $BUSD
- Purchase $BUSD with other crypto you have
Alternatively, you can head to the Paxos website and convert U.S. dollars directly into $BUSD. Paxos will take your fiat, add it to the reserves, and then mint new coins for you.
$BUSD is available to Africans via the Binance exchange, including Binance P2P.
$USDT
Tether (often called by its symbol – USDT) is a stablecoin cryptocurrency that is hosted on the Ethereum and Bitcoin blockchains among others.
Its tokens are issued by the Hong Kong company, Tether Limited, which in turn is controlled by the owners of Bitfinex. Tether is called a stablecoin because it was originally designed to always be worth US$1.00, maintaining $1.00 in reserves for each Tether issued.
$USDT is available for purchase or exchange on major crypto exchanges, including:
- Binance
- Coinbase
USDT can also be bought on P2P exchanges including Paxful and Binance P2P, both of which are available in Africa.
$cUSD
Celo Dollar ($cUSD) is a stablecoin by the Celo foundation. It is designed to provide a mobile-friendly form of digital money that can be used by the 6 billion smartphone users around the world.
$cEURO is a stable digital asset that algorithmically tracks the Euro.
$cUSD and $cEURO are supported by the Celo Reserve, a diversified portfolio of cryptocurrencies.
You can purchase $cUSD with fiat or exchange it for other crypto on the following exchanges:
- Bitget
- KuCoin
- Gate.io – Available to Africans using card payments
- Bittrex
- OkCoin – Available in multiple African countries via WireTransfer
Stablecoins are helpful because investors and traders use them to trade cryptocurrencies without the risk of their asset losing value in the volatile crypto market. Investors get to earn passive income using a stable currency through staking and other means.
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RECOMMENDED READING: How Stablecoins Hedge Against Market Volatility
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