Stablecoin Terms Guide
Recall the key stablecoin terms that affect payment and holding risk.
Peg versus redemption: which question are you answering? Do not treat a visible market price as proof of redemption quality. It's a stablecoin, so settlement is basically cash. A stakeholder wants to skip payment checks. Equating target price with cash finality. Say The target price is only one part. We still need issuer, chain, address, confirmation, and off-ramp rules. It separates price behavior from the payment controls that determine whether the business can use the funds. What is reserve risk? The risk that backing assets are insufficient, low quality, inaccessible, or not available when holders expect redemption. Reserve claims need…
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