The 12 Most Popular Stablecoins in Q2, 2022

most popular stablecoins

With the recent collapse of UST, I wanted to dive into stablecoins again. So, let’s do a quick run down of the best stablecoins. And before I do that I want to say that literally everything in crypto is a risk. Yes, even stablecoins. And, no, this is not an exhaustive list of stablecoins. Coingecko alone lists about 80 stablecoins and even that is not an exhaustive list.

Also, if you’re looking for the best ways to earn yield on your stablecoins, check out “Getting The Best Return on Stablecoins”

The Top 12 Most Popular Stablecoins in Q2, 2022

#12. UST

LOL.

My Rating 0

#11. USDN

This is the native stablecoin of the Waves network. It also operates with a crypto collateral redemption system similar to, but not exactly like, UST. Waves CEO breaks down key differences HERE. That being said it has significant issues trying to hold its peg. It is essentially a dangerous experiment on par with UST. 

My Rating 1/10

#10. USDD

The newest offering from Justin Sun, of Tron. This is an algo stablecoin which can allow investors to earn up to 40% on a Tron based platform. The mechanics of this are scarily similar to UST. It feels like a dangerous experiment and I will be staying far away. 

My Rating 1/10

#9. MIM

Why do you like to hurt yourself? Seriously. While on the one hand MIM is “safe” because it is over collateralized on a model similar to DAI. The real problem with MIM comes with the people behind it. The director of MIM and related products knowingly allowed one of the industry’s worst serial scammers of QuadrigaCX fame to be involved with one of his other close projects, Wonderland. Which makes you wonder what kind of poor judgment must be shown with MIM? How can anyone actually trust their money here? That being said it does still have use cases in defi, and in theory the collateral model should work. 

My Rating 3/10

#8. FRAX

Frax is an algo stablecoin. Yeah, another one, but this is not UST. Frax maintains a partial collateralization of USDC… so why not just hold USDC? It is also looking to acquire layer one tokens like ETH and AVAX to back the coin. It also uses the Frax Shares, a secondary token, to help maintain the peg. It has an ok level of use cases in defi, and almost no centralized exchange adoption. While this is definitely less risky than UST, ask yourself, do you really want to gamble on another algo stablecoin? Is the risk worth it? In my opinion the only reason to hold this would be for a specific farming opportunity, but even then remember this is still an experimental coin. 

My Rating 3/10

#7. GUSD

This is the Gemini dollar. Backed by the exchange of the same name. In theory it is a solid stablecoin, but almost no one uses it except Gemini and Blockfi (Gemini is an investor, surprise!). The defi use cases are nearly non-existent. 

My Rating 5/10

#6. TUSD

The Trust USD, it has 1 to 1 backing and audits. Easy redemption for real dollars. Has limited adoption across defi and centralized exchanges. But overall a “decent” stablecoin option. Bonus points here is that Trust Company also offers stablecoins for Canadian Dollars, Australian Dollars, British Pounds, and Hong Kong Dollars. 

My rating 7/10

#5. PAX

This is the Paxos Dollar. This is a pretty damn safe stablecoin. Fully regulated. Fully backed. Regularly audited. BUT, it has failed to see any real deep integrations across the defi space, nor has it taken off in any big way on centralized exchanges. You might as well just use BUSD which has all the same benefits, but is also used everywhere. 

My Rating 8/10

#4. USDT

It is everywhere. It is a staple of centralized exchange trading pairs. It is backed in a similar fashion to USDC by a basket of dollar denominated products. It is one of the “better” ones for sure.

BUT, the team has a history of being shady, lying, and failing to deliver on transparency. Which makes it far from ideal in my opinion. And while I frequently use USDT, I do not store money in it when not needed. Once I am done with a farm I usually move back to USDC. Oh, and Tether has been frequently the target of investigations by US regulators.

These reasons are why we saw USDT depeg last week in the aftermath of the UST mess, because fundamentally people have trust issues with USDT. That being said, USDT gets points for being the first mover and so widely adopted, but otherwise… 

My rating 8/10

#3. DAI

A very popular stablecoin which has seen strong adoption on defi, but little adoption from centralized exchange services. Maker Dao, the platform behind DAI is one of the earliest defi protocols. Dai is backed by over collateralized loans. Thus ensuring that any bank run risks are kept very minimal since there is always way more collateral in the system than DAI. I don’t use DAI frequently simply due to more limited use cases, but I do think that DAI is pretty safe for a stablecoin backed by crypto collateral and it has been around for a few years. 

My rating 9/10

#2. BUSD

This is the Binance dollar. Actually a pretty good choice for a stablecoin assuming you trust Binance. BUSD was co-founded by Paxos, a highly reputable stablecoin company.  BUSD’s reputation and security is backed by one of the world’s biggest exchanges. BUSD is widely used in defi, on centralized exchanges, and lives across many chains. It is fully backed with cash and treasury bills and undergoes monthly audits. It is also fully regulated. 

My rating 10/10

#1. USDC

A stablecoin launched by Circle and Coinbase. Its value is guaranteed by Coinbase, one of the biggest and most trusted exchanges, which will always exchange 1 USDC for 1 real dollar. It is fully backed by assets held in US accounts. It is audited monthly. It has money licenses and is fully regulated. It also has HUGE adoption. This is why I am putting USDC at the top of the list in rankings.

It can be used across almost all defi applications on almost every blockchain. It is growing in prominence on trading pairs on centralized exchanges. It has even been adopted by companies like Visa. From what I see, USDC is “the stablecoin” to be using, but BUSD is a very close second. 

My Rating 10/10

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