Stablecoins are one of the most relevant developments in the crypto ecosystem and one that has been increasingly getting traction. Recently, I presented a session that highlighted some interesting analyses that arise from applying data science methods on stablecoin’s blockchain data. The slide deck and video from the session will be available soon but I thought I share some of the most intriguing data points.
At a high level, stablecoins can be divided in three main categories:
1. Fiat-Backed Stablecoins: This type of stablecoins is typically pegged to a fiat currency or other real world assets. Projects such as Tether or TrueUSD as examples of stablecoins backed by fiat currencies while tokens such as Digix Global represent a commodity backed stablecoin.
2. Crypto-Collateralized Stablecoins: This type of stablecoins are backed by pools of crypto-assets. Typically, crypto-collateralized stablecoins tend to over-collateralized in order to address market volatility. Projects like Maker are notorious examples in this category.
3. Non-Collateralized: This type of stablecoins are not backed by any real-world or cryptocurrency asset, and instead it maintains value by people expecting it will maintain a certain value. The most-common non-collateralized method is seigniorage shares which uses smart contracts that automatically expand and contract the supply of the non-collateralized stablecoin using algorithms to maintain its value. Projects like Carbon are relevant examples of this category.
In the current market, fiat-based stablecoins are the dominant class while projects like Maker have achieved meaningful traction as crypto-collateralized stablecoins. Non-collateralized stablecoins remain highly experimental at this point. Despite the popularity of some of these projects, we know very little about their underlying behavior. Let’s look at some data points about fiat and crypto collateralized stablecoins that might surprise you.
5 Surprising Analytics About Fiat-Collateralized Stablecoins
1)Investors Have Lost Money with Stablecoins
2)Stablecoin Networks are not Growing
3)Most Stablecoins are Not Used for Large Transactions with the Exception of Tether
4)Despite its Global Adoption, Most Fiat-Based Stablecoins are More Popular Outside Asia
5)Daily Activity Outside Tether is Still Relevant
5 Surprising Analysis About Crypto-Collateralized Stablecoins
1)Some Investor Have Lost Money with Dai
2)Dai is Growing
3)Large Transactions in Dai are not Consistent
4)Dai Has Been More Adopted Outside Asia
5)Dai’s Daily Trasaction Activity is Impressive
These are just some of the interesting facts about stablecoins that we have seen by exploring the IntoTheBlock platform. More interesting analysis to come soon.