While stablecoins are generally considered to be less volatile than other cryptocurrencies, they are not risk-free. Some of the risks associated with holding stablecoins include:
- Counterparty risk: the risk that the issuer may not be able to maintain the pegged value,
- Regulatory risk: changes in government regulations could impact the value or availability of stablecoins, and
- Technological risk: potential vulnerabilities in the blockchain or smart contracts used to support the stablecoin.
As with any investment, it is important to conduct your own research and understand the risks involved before investing in stablecoins.