Crypto Corner: Stablecoin Assets Pass $20Bn Mark

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Adam Vettese (eToro) | The total value of stablecoins has surpassed $20 billion for the first time, as investors move to hedge their risks in both cryptoassets and traditional markets. Coindesk, quoting data from Coin Metrics, show that the total value of assets for all stablecoins breached the $20 billion mark yesterday, just four months after breaking a $10-billion record in May.

Stablecoins are digital tokens, the values of which are pegged to fiat currencies like US dollars.

John Todaro, director of institutional research at cryptocurrency analysis firm TradeBlock, said: “Because some exchanges do not offer fiat pairs, stablecoins are the only available option for traders to move risk-off into fiat-like assets during periods of volatility.”

Many investors see stablecoins as an intermediary step before putting money in riskier cryptocurrencies. After purchasing the stablecoins with US dollars, for example, they can move the stablecoins to exchanges and trade for cryptocurrencies such as Bitcoin, Ethereum or others.