Definition ∞ Stablecoin usage refers to the deployment and circulation of cryptocurrencies designed to maintain a stable value relative to a fiat currency or other asset. These digital assets are employed for various purposes, including trading, lending, and as a medium of exchange within the crypto economy. Their stability makes them a preferred choice for mitigating volatility risk in transactions and as collateral in decentralized finance. The widespread use of stablecoins facilitates easier movement of value across different platforms.
Context ∞ News frequently covers the increasing stablecoin usage in cross-border payments and as a primary liquidity source for decentralized exchanges. Regulators worldwide are closely examining stablecoins, particularly concerning their reserves and potential systemic risks. The debate surrounding their regulatory oversight and their role in the broader financial system remains a prominent topic.
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