Cryptocurrencies have become an attractive option for bettors in recent years, but there are a few traits that have prevented them from becoming truly mainstream. One significant concern about cryptocurrencies is their volatile nature; new technological advances, national regulation, speculation, and more can have significant impacts on the value of cryptocurrencies.

Stablecoins hope to solve price instability while still offering the benefits of digital currencies; stability, speed, and security. Like with crypto, “stablecoin” refers to several digital currencies backed by real-world goods.

Stablecoins are an excellent choice for someone interested in the benefits of cryptocurrency without dealing with the unpredictable changes in value that come with digital money. Stablecoins are backed by real assets, such as the United States Dollar, cryptocurrencies, or even raw resources like steel, oil, and gold.

Bettors looking to take advantage of cryptocurrency have been turning to stablecoin for a more familiar experience than purely digital money. Many betting sites even accept stablecoins for payment with many of the same benefits of using crypto.

Why do stablecoins exist?

At first glance, it seems like stablecoins are just an alternative to cryptocurrency with an extra hoop to jump through when calculating your finances. They’re less popular than mainstream cryptocurrencies, and they can be more challenging to acquire and trade. While cryptocurrencies emphasize accessibility and security, stablecoins aim to provide stability. While it can be fun to watch your crypto’s value bounce up and down, many would prefer to keep their finances predictable.

Stablecoins present that value in their very name. Unlike Litecoin or Bitcoin, the price of stablecoins is not based on its use as a currency. Instead, the value of a stablecoin is tied to real-world assets that have a tangible market value. For example, the most popular stablecoin Tether is pinned to the United States dollar. Other stablecoins are also tied to currency, such as GYEN, which is backed by the Japanese Yen.

Currency isn’t the only thing backing stablecoins. Some are based on natural resources, like Digix Gold, which is supported by gold. Another stablecoin called Tiberius is based on a mix of several rare metals that are used in technology manufacturing.

As the prices of those goods change, so do the prices of Digix and Tiberius stablecoins. While there is still some variance in the value of stablecoins, their attachment to valuable physical goods means that there’s a market precedent for price changes. Bettors looking to keep their investment stable while still benefiting from cryptocurrency often look to stablecoins for their security and real-world value.

What are the benefits of using stablecoins?

Aside from the previously mentioned stability, bettors receive many of the same benefits of using cryptocurrencies when using stablecoins. That means fast and lower-fee transactions that are permanently recorded on the blockchain. Many bettors, especially esports-focused bettors, find the speed of stablecoin transactions useful. An esports tournament can feature new match-ups on an hourly basis, so stablecoins give esports bettors more control over when they want to deposit and withdraw their funds.

Stablecoins are also particularly well-suited to long-term bettors. Cryptocurrency volatility means that your winnings could shrink due to circumstances outside of your control. Government regulation and media treatment can significantly affect the price of cryptos, but most stablecoins are tied to already valued goods. Gold is one of the most common investments, and there aren’t any breakthroughs in it on the horizon.

Stablecoins also allow you to invest in some very niche areas. For example, FACTOR-805 is a stablecoin directly tied to the value of an apartment building just south of Williamsburg on Long Island, New York.

A financial-savvy bettor might even use their stablecoins as an investment in itself. If you think the price of gold will rise, you can bet with stablecoins based on gold to invest your winnings with no access limits automatically. It’s worth noting that while stablecoins themselves are traded and recorded on the blockchain, the goods they represent are not. There is no public ledger for precious minerals or gold. The prices of commodity-backed stablecoins are easily displayed by the organizations creating them.

Stablecoins are the ideal choice for a bettor who wants the advantages of cryptocurrency without the risk of price fluctuations.

Collateralized versus non-collateralized stablecoins

There are two major categories of stablecoins: collateralized and non-collateralized. Collateralized stablecoins are backed directly by the goods mentioned above. A single stablecoin backed by the United States Dollar should be worth one USD. A single stablecoin collateralized by gold is directly tied to a certain amount of gold, the value of which can change with the market.

Non-collateralized stablecoins instead seek to directly correlate their value to the price of a specific good. They usually have reserves that can be introduced or removed from the market so that the stablecoin is always worth what the product is worth.

Bettors should decide whether collateralized or non-collateralized stablecoins are right for them. Collateralized is much more common and easier to understand, but non-collateralized offers a higher degree of privacy and potentially less risk. Whichever stablecoin you choose, you’ll get the advantages of cryptocurrency with the security of real-world investment.

If you want to try betting or playing casino games with stablecoins, then visit Thunderpick accepts stablecoins (Tether - USDT) and other cryptocurrencies as ways to deposit and offers complete security and fast withdrawals on any winnings.