  In the wake of financial crises, stablecoins are gaining adoption among
digital currencies. We discuss how stablecoins help reduce the volatility of
cryptocurrencies by surveying different types of stablecoins and their
stability mechanisms. We classify different approaches to stablecoins in three
main categories i) fiat or asset backed, ii) crypto-collateralized and iii)
algorithmic stablecoins, giving examples of concrete projects in each class. We
assess the relative tradeoffs between the different approaches. We also discuss
challenges associated with the future of stablecoins and their adoption, their
adoption and point out future research directions.
