When entering the crypto community for the first time, many people will be dazzled by the various currencies. Bitcoin is well-known, but in addition to Bitcoin, there are many other currencies, such as stablecoins, mainstream coins, platform coins, altcoins, etc. These currencies have their own characteristics and different application scenarios. Let's take a closer look at these crypto assets.

First, let's take a look at stablecoins. A stablecoin is a cryptocurrency with an "anchor" property, usually pegged to the U.S. dollar or other stable assets. Therefore, its price does not fluctuate wildly, making stablecoins a very practical medium of exchange. The earliest stablecoin was USDT (Tether), which was launched by Tether in 2014 and its value is pegged 1:1 to the U.S. dollar.

So, what are the categories of stablecoins? According to different anchoring methods, stablecoins can be divided into the following categories:

1. US dollar stablecoin: The value of this type of stablecoin is directly linked to the US dollar, such as USDT, USDC, etc. They are usually issued by centralized companies and anchored through bank accounts and digital currency exchanges.

2. Legal currency stablecoins: The value of this type of stablecoin is pegged to a country’s legal currency, such as the Euro stablecoin, the RMB stablecoin, etc. They are usually issued by some banks or financial institutions and anchored through the interbank market and digital currency exchanges.

3. Asset stablecoins: The value of these stablecoins is linked to a physical asset, such as gold stablecoins, oil stablecoins, etc. They are usually issued by an institution or organization and are anchored by custody of physical assets and digital currency exchanges.

4. Crypto-asset stablecoins: The value of these stablecoins is linked to a certain crypto-asset, such as Bitcoin stablecoins, Ethereum stablecoins, etc. They are usually issued by an institution or organization and are anchored by staking crypto-assets and digital currency exchanges.

Regardless of the type of stablecoin, they all have the following common characteristics:

1. Relatively stable prices: Since the value of stablecoins is pegged to an asset or currency with a stable value, their prices are relatively stable and will not fluctuate drastically like other cryptocurrencies.

2. Convenient transactions: Stablecoins are more easily accepted and traded than other cryptocurrencies because their prices are stable and they do not require a lot of computing and storage space like other cryptocurrencies.

3. Reduce risk: In crypto asset trading, investors need a relatively stable bridge currency to preserve the value of on-chain assets. Taking the Bitcoin/USD trading pair as an example, if investors expect Bitcoin to fall, they can use this trading pair to sell Bitcoin and obtain USD to preserve the value of assets. If stablecoins are used for trading, this exchange rate risk can be avoided.

4. Improve fund utilization: Using stablecoins for transactions can avoid fund losses caused by exchange rate fluctuations, so that funds can be better used for investment or other trading activities.

In addition to stablecoins, there are other types of crypto assets that are worth mentioning. For example, mainstream coins, platform coins, and altcoins. Mainstream coins are usually cryptocurrencies with large market capitalization and wide applications, such as Bitcoin, Ethereum, etc. They usually have a relatively mature ecosystem and a wide range of application scenarios. Platform coins are tokens issued by some blockchain platforms, such as ETC (Ethereum Classic) issued by the Ethereum platform. They are usually used for payment and settlement operations within the platform. Altcoins are small cryptocurrencies with specific application scenarios, such as Dogecoin, Litecoin, etc. They usually have relatively unique mechanisms and application scenarios.

In short, different types of crypto assets have different characteristics and application scenarios. When choosing, you need to judge and choose according to your own needs and risk tolerance. At the same time, it is recommended to do more homework before investing and invest cautiously.#币安合约锦标赛 $BTC