affiliated with the US Department of Commerce National Institute of Standards and Technology (NIST)peoples stablecoin He published a report officially defining stablecoins so that he can better understand how the technology is designed.
The institution examined the technical features, operation and technology of stablecoins in the draft it published with the code NIST IR 8408.
While examining the 20 largest stablecoins by market capitalization, the report found that the top 5 stablecoins dominate 87% of the market. Stablecoins that dominate the market Tether (USDT), USD Coin (USDC), Binance USD (BUSD), Dai (DAI) and Frax (FRAX) it happened.
According to the research, these 5 stablecoins have been more successful than others in indexing to the US dollar. Leading stablecoins averaged $0.9934 at the time of research as the lowest level.
NIST, in its study in the past months Terra USD (UST) He also mentioned the loss of stability and collapse. In the report, the institution also explained some of the issues that raise concerns about stablecoins.
“Stablecoin projects generate unlimited supply without authorization. Project pioneers can use their privileged status negatively to cause a massive scam. Also noteworthy are the vulnerabilities in smart contracts.”
According to NIST’s interpretation, central finance suffers from trust issues due to the presence of the human factor. However, there is no such problem in decentralized finance DeFi. The main problem for DeFi is the vulnerabilities that come from smart contracts.
NIST has also requested public comment on the stablecoin report. The institution will accept comments until January 6, 2023.
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