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Stablecoins are gaining popularity year after year. They combine the best elements of fiat money and Cryptos. Stablecoins‘ pricing is fairly predictable because they are commonly pegged to fiat currencies due to the fact that they are less volatile than other Cryptos. However, because stablecoins are still regarded as Cryptos, they can be used for virtually instantaneous cross-border transactions and are not regulated by banks or governments. Yet, stablecoins are not totally dependent on fiat money. The tokens are used in various well-known projects and are tied to precious metals, Crypto, and other assets. If you want to add stablecoins to your portfolio, read this article to learn about the best stablecoins to buy in March 2023. Here is a list of the top 5 stablecoins to buy in March 2023.
Before we move forward to check the list, here’s a quick overview of what stablecoins are and their characteristics.
What are stablecoins?
Stablecoins are Cryptos that make an effort to keep their value pegged to assets belonging to other classes, such as fiat money, commodities, and so forth. In this context, the term “stable” refers to how much more predictable the prices of stablecoins are than most other Cryptos.
Stablecoins thereby address the main issue with Cryptos, namely their extremely volatile pricing. Because of this, consumers use them as instruments of reliable value storage and affordable money transfers in addition to rebalancing their portfolios.
Characteristic features of stablecoins
- Stablecoin prices don’t fluctuate as wildly as regular Cryptos. Crypto prices are ever volatile and unpredictable at the best of times. This particular trait of Cryptos is one of the factors that’s keeping them from becoming mainstream modes of payment. However, stablecoins are tied to underlying assets that collateralize and keep them grounded, so they are suitable for mainstream adoption.
- Since stablecoins are basically Cryptos, transactions are processed fast while maintaining the counterparties’ privacy and security, making them fit to be used for regular transactions.
- Using stablecoins for transactions also means you pay the lowest possible trading charges, regardless of the Crypto exchange in India you use to trade and store your Crypto.
- Like the usual Cryptos, you can send funds to anyone in any corner of the world using stablecoins without intermediaries.
After understanding stablecoins and their characteristic features, let’s now see the top 5 stablecoins that you can invest in March 2023.
#1 Pax Gold (PAXG)
The Paxos Trust Company is the custodian of the ERC-20 stablecoin PAX Gold (PAXG), which is backed by physical gold reserves. Each PAX Gold token is equivalent to one troy ounce of a 400-ounce London Good Delivery gold bar in protected gold vaults like Brinks’. Because PAXG represents actual gold, its value is directly correlated with the current market price of that actual gold.
The New York State Department of Financial Services oversees and approves PAXG. A third-party auditing company conducts monthly audits to confirm that Paxos’ gold reserve matches the supply of PAXG tokens to ensure that Paxos maintains its reserves. These attestation reports are published on Paxos’ official website. The developers of PAXG regularly inspect smart contracts for potential faults.
#2 Tether (USDT)
Investors invest in stablecoins to provide security and stability to their assets during a Crypto market crisis. USDT is a coin that can be easily exchanged for other currencies. It is built on Bitcoin’s public ledger, so it’s always available to use, and you’ll never have to worry about fluctuating value.
USDT was introduced in 2017 by Tether Ltd, which is based in Hong Kong. Tether aims to provide an alternative to fiat currency using blockchain technology, allowing them to create a digital currency with no volatility. To maintain stability, USDT primarily balances another Crypto through pair exchange.
#3 USD Coin (USDC)
Another USD-pegged stablecoin with a 1:1 ratio, USD Coin, entered the top 5 Cryptos by market cap. A project of Coinbase and Circle is USDC. The USDC supply is backed by fiat money reserves and US treasuries. Given that Coinbase is one of the top Crypto exchanges worldwide, USDC will surely be a wise investment in March 2023.
The USD Coin gains from the weak fiat markets, influenced by the dollar value. Many consumers will choose USDC as a steady pair to avoid losses. Hence, the coin will persevere through the Crypto winter.
#4 Binance USD (BUSD)
Paxos and Binance established the BUSD stablecoin in an effort to develop a Crypto that would be pegged to the US dollar. The fact that one unit of BUSD is equal to one US dollar is a major feature of BUSD. Paxos owns a quantity of US dollars equivalent to the whole supply of BUSD to support this value. As a result, changes in the price of USD immediately affect the stablecoin’s price. To guarantee the protection and safety of user assets, BUSD delivers a monthly audited report of reserves in accordance with strict regulatory criteria.
#5 Dai (DAI)
Dai is the most popular stablecoin supported by Crypto. Dai development is under the control of the Maker DAO organization. The price of DAI is set to USD, despite being backed by tokens built on the Ethereum platform. A multi-collateralized DAI was launched in 2019. Dai is one of the digital currencies with the largest market capitalization.
Conclusion
The majority of stablecoins are linked to other Cryptos, precious metals, and fiat money. Compared to traditional Cryptos like Bitcoin, Ethereum, and others, they are believed to be considerably more stable. In this blog, we have curated a list of top stablecoins you can consider investing in March 2023. Anyway, conducting your own research is advisable before taking any investment advice from others.
Frequently Asked Questions
Is Cryptocurrency Legal In India?
In India, cryptocurrencies are legal; anyone can purchase, sell, and trade cryptocurrencies. They are currently unregulated; India does not have a regulatory framework in place to regulate its functioning. According to the Ministry of Corporate Affairs (MCA), companies must now declare their crypto trading/investments during the financial year, according to the Ministry of Corporate Affairs (MCA). Cryptocurrency transactions have been taxable in India when people receiving such gains are Indian tax residents or where the crypto is considered to be domiciled in India
What Is Crypto?
Crypto or a cryptocurrency is a digital currency protected by cryptography, making counterfeiting and double-spending nearly impossible. Blockchain technology is used to produce cryptocurrencies (a distributed ledger enforced by a distributed network of computers). Cryptocurrencies are distinct in that a government does not issue them. The word "cryptocurrency" refers to the encryption methods employed to keep digital currencies and the network secure.
Is Bitcoin And Cryptocurrency The Same Thing?
Bitcoin is a cryptocurrency that was designed to facilitate cross-border transactions, eliminate government control over transactions, and streamline the entire process without third-party intermediaries. The absence of intermediaries has resulted in a significant reduction in transaction costs. Satoshi Nakamoto, the creator of Bitcoin, created the first cryptocurrency in 2008. It began as open-source software for money transfers. Since then, plenty of cryptocurrencies have emerged, with some focusing on specific fields.
What Is Virtual Currency?
Virtual currency is a type of uncontrolled digital currency that can only be used online. It is exclusively stored and transacted using designated software, mobile or computer applications, or unique digital wallets, and all transactions are conducted through secure, dedicated networks. Because digital currency is just currency issued by a bank in digital form, virtual currency is not the same as a digital currency. Virtual currency, unlike ordinary money, is based on a trust structure and cannot be issued by a central bank or other banking regulatory organization.
How To Invest In Cryptocurrency Stocks?
Cryptocurrency can be purchased in two ways: through mining or exchanges. The process of confirming and adding transactions to the blockchain public ledger is known as cryptocurrency mining. Cryptocurrency exchanges are another option. Exchanges make money by charging transaction fees, but there are alternative platforms where you may communicate directly with other cryptocurrency traders.
What Is Cryptocurrency?
A cryptocurrency is a digital currency secured by encryption, due to which chances of activities such as counterfeiting and double-spending taking place get close to impossible. Cryptocurrencies get created on blockchain technology ( a distributed ledger enforced by a distributed network of computers). Cryptocurrencies are unique in that they do not get issued by any central authority. The term "cryptocurrency" comes from the encryption techniques used to keep digital currencies and the network safe.
Can I Invest In Cryptocurrency?
Yes, with exchanges like WazirX, you may invest in cryptocurrency in India. To begin, go to the WazirX website and register. After that, you will receive a verification email. The link received by verification mail will only be available for a few seconds, so make sure you click it as quickly as possible. This will successfully verify your email address. The following step is to set up security, so choose the best solution for you. After you've set up the security, you'll be given the option of continuing with or without completing the KYC process.
Is Ethereum Safe To Invest?
The Bitcoin market is unquestionably more volatile than the stock market. This may not be the market for you if you are incredibly risk-averse. Ethereum, on the other hand, may be a terrific investment for you if you're a diamond-handed investor who won't lose sight of short-term losses. Ethereum is a relatively safe investment as it is also based on blockchain.
What Is The Meaning Of Crypto?
A cryptocurrency is a digital currency that is secured by the process of cryptography, making counterfeiting and double-spending almost impossible to happen. Blockchain technology is used to produce cryptocurrencies ( a distributed ledger enforced by a distributed network of computers). Cryptocurrencies are distinct in that a centralized authority does not issue them.
How Many Cryptocurrencies Are There?
There are over 5000 other digital currencies available on the internet in addition to Bitcoins. The only problem is that they haven't gotten the users' attention. Besides Bitcoins, a few other digital currencies have gained popularity among users. It's been more than ten years since Bitcoins were first released, and now they've achieved new heights thanks to their phenomenal success.
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
