Stablecoins in plain language
Why USDT and USDC sit near $1 — and what risks remain.
4 min · Original LiquidityFlow guide
Stablecoins are tokens designed to track a reference — usually the US dollar. On LiquidityFlow they often look “boring” in price tables, yet they dominate volume because they are the quote asset for many pairs.
Mechanisms differ: fiat-backed reserves, crypto-collateralized systems, or algorithmic designs. Peg quality depends on reserves, redemption, and market confidence — a $1 print is not a guarantee.
For tools and paper trading we treat USDT as the unit of account. Always read issuer disclosures when moving real funds.