Stablecoins like USDT and USDC are pivotal to DeFi liquidity. Pegged to fiat (e.g., USD), they provide price stability, reducing volatility risks in DeFi protocols. They serve as key trading pairs on decentralized exchanges (DEXs), enabling seamless swaps and high liquidity pools. In lending platforms, stablecoins are collateral or borrowed assets, supporting leveraged strategies and yield farming. Their widespread adoption ensures interoperability across DeFi ecosystems, facilitating cross-chain transactions and bridging traditional finance with blockchain. By maintaining consistent value, they attract institutional and retail users, boosting participation in staking, liquidity provision, and governance. Integration with automated market makers (AMMs) and stablecoin-specific pools further enhances capital efficiency, ensuring robust liquidity for DeFi’s decentralized financial services.