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http://dx.doi.org/10.9708/jksci.2022.27.12.171

Classification and Risk Analysis of Stablecoins  

Kim, Junsang (Dept. of Cyber Science, Korea Naval Academy)
Publication Information
Journal of the Korea Society of Computer and Information / v.27, no.12, 2022 , pp. 171-178 More about this Journal
Abstract
In this paper, we propose a classification method according to the type and characteristics of stablecoins for risk analysis, and analyze the risk factors of each stablecoin based on this classification. First, this paper explains the technologies and ecosystem of blockchain and decentralized finance(DeFi) to understand stablecoins. In addition, the operation principle of the major stablecoins currently released and used is explained for each proposed classification type. Based on this, the risk type and risk factors of each stablecoin are derived. The risk types proposed in this paper are classified as defegging, liquidation, and exploit, and the risk factors are classified as depegging due to reliability of operator, depegging due to reliability of algorithm, depegging due to failure of algorithm, liquidation due to high volatilty and oracle attack. Based on the proposed classification, we analyze the risk factors of major stablecoins currently circulating in the crypto market.
Keywords
Blockchain; Cryptocurrency; Stablecoin; Decentralized Finance; DeFi;
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Times Cited By KSCI : 1  (Citation Analysis)
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