Stablecoins
Plain English
Cryptocurrencies designed to maintain a stable price, usually pegged to $1 USD. USDC and USDT are backed by real dollars in banks. DAI is algorithmic - maintained by smart contracts. Think of them as digital dollars - stable enough for payments and trading without wild price swings.
Technical
Cryptocurrencies engineered to minimize price volatility through various mechanisms: fiat-collateralized (USDC, USDT backed by USD reserves), crypto-collateralized (DAI backed by ETH/other crypto), and algorithmic (supply adjusts based on demand). Essential for DeFi as unit of account, medium of exchange, and store of value in volatile crypto markets.