Security Perceptions of Users in Stablecoins: Advantages and Risks within the Cryptocurrency Ecosystem

Stablecoins, a type of cryptocurrency pegged to another asset to maintain a stable price, have become an important part of the cryptocurrency ecosystem. Prior studies have primarily focused on examining the security of stablecoins from technical and theoretical perspectives, with limited investigation into users' risk perceptions and security behaviors in stablecoin practices. To address this research gap, we conducted a mixed-method study that included constructing a stablecoin interaction framework based on the literature, which informed the design of our interview protocol, semi-structured interviews (n=21), and Reddit data analysis (9,326 posts). We found that participants see stable value and regulatory compliance as key security advantages of stablecoins over other cryptocurrencies. However, participants also raised concerns about centralization risks in fiat-backed stablecoins, perceived challenges in crypto-backed stablecoins due to limited reliance on fully automated execution, and confusion regarding the complex mechanisms of algorithmic stablecoins. We proposed improving user education and optimizing mechanisms to address these concerns and promote the safer use of stablecoins.