The US National Institute of Standards and Technology (NIST) has published an internal report on understanding stablecoin technology and related security considerations.
Stablecoins are a type of cryptocurrency that aim to maintain a stable price relative to a specified asset (usually a fiat currency). One of the observations is that the top five market capitalization stablecoins that did not lose their peg during the one year study were: Tether (USDT); USD Coin (USDC); Binance USD (BUSD); Dai (DAI); and Frax (FRAX). All five were pegged to the U.S. dollar and – as a group – had a mean minimum value of $0.9934 (-0.66 %) and a maximum minimum value of $0.9871 (-1.29 %).
The report evaluates the technical designs of different stablecoin architectures, including an extensive analysis of collateralization processes, and discusses related security analyses.
This publication:
- Describes and defines stablecoins from a technical perspective
- Identifies four common properties of most stablecoins
- Identifies 11 characteristics that represent features of differentiation between stablecoins
- Provides a taxonomy of six common stablecoin types
- Evaluates the needed properties of security, stability, and trust
- Identifies 18 potential issues in stablecoin implementations