Cardano-based stablecoins were long-awaited by a community interested in the ecosystem since this type of asset is the cornerstone of any blockchain-based ecosystem that acts as a bridge between fiat and digital assets.
As the crypto ecosystem builder co-founder Sebastien Guillemot noted, the recently released DeFi platform Wingriders is offering $7 million USD-based stablecoins. According to the developer, anyone can wrap their USDC/USDT in Cardano by using only two bridges: Nomadxyz and Milkomeda. Both projects that allow usage of stablecoins on Cardano are open to any user.
Some Cardano enthusiasts displayed their concerns with using bridges as they bring more risks during transfers and are less user-friendly. But Guillemot threw some light on algorithmic stablecoins widely used by crypto enthusiasts as they bring their risks, as well depending on the change mechanism.
Algorithmic stablecoins are one of the most common types of assets in the cryptocurrency market as it offers easy-to-use solutions accepted by numerous centralized and decentralized cryptocurrency exchanges. But before using each algorithm, it is better to become educated on the type of mechanism used by it as a wrong configuration in the coin’s code may bring various risks to its users and even cause a decoupling.
Right from the summer of 2021, users were actively criticizing the biggest stablecoin on the market, Tether, which is being used on three chains; Tron, Ethereum, and Omni. The main concern of crypto users was the fact that it was not clear if Tether held any illegal papers to back their stable assets.
Tether, USDC, and UST remain one of the biggest assets on the cryptocurrency market with $155 billion in combined capitalization.