Algorithmic Stablecoins Explained

Algorithmic stablecoins achieve price stability without relying on fiat or cryptocurrency as collateral. Instead, they utilize algorithms and smart contracts to control the token supply. By dynamically adjusting the number of tokens in circulation, these stablecoins aim to maintain a specific price target. Through this automated mechanism, the algorithm expands or contracts the token supply as needed, ensuring price stability for the stablecoin.