Stablecoin is cryptocurrency that is pegged to a physical asset, such as US dollar or oil price. Examples of stablecoins are Tether and Petro. Tether is pegged against US dollar, so the value of one Tether is always equal to one US dollar. Whereas Venezuelan Petro is backed by the government’s oil reserve. If the price of oil goes up, the price of Petro goes up and vice versa. Stablecoins must be backed up by the equal amount of the physical asset they are pegged to. This requires users to trust a centralized entity who holds the reserve that backs up the stablecoin. Stablecoins are auditable on their own blockchains but it is difficult to audit the reserve that is backing them up.