Stablecoins Terms
Algorithmic Stablecoin
A stablecoin maintaining its peg through algorithmic supply adjustments rather than direct collateral.
Death Spiral
A catastrophic feedback loop where selling destroys backing asset value, accelerating peg collapse.
Depeg Event
When a stablecoin price significantly deviates from its intended peg.
Overcollateralized Stablecoin
A stablecoin backed by crypto collateral worth more than the stablecoin supply.
Peg Mechanism
The set of incentives and rules maintaining a stablecoin at its target value.
Reserve Ratio
The proportion of backing assets held relative to outstanding stablecoin supply.