Stablecoins are a bridge. A bridge enables you to cross something because you want to be on the other side (where Bitcoin lives).
A bridge is useless if there is no reason to be on the other side.
In this case, the cryptoverse is on the other side, and many traditional investors want to be there, but high-risk volatility (the fear of losing money by investing in Bitcoin) keeps them away.
“The reason is simple: Stablecoins are the bridge between cryptocurrencies and traditional finance. Without stablecoins, crypto applications have to wrestle with volatility, and volatility makes financial contracts expensive.”
Harvard Business Review
Stablecoins represent the bridge that allows these investors to set foot in the cryptoverse.
(Bitcoin and Ethereum Exchange Traded Funds [ETF] offer the same bridge, but this story focuses on stablecoins)
“Stablecoins have emerged as an effective tool to hedge this massive volatility, with a simple premise that allowed traders a seamless crypto pair into a fiat pegged cryptocurrency.”
