At its core, the algorithmic stablecoin system reduces the supply of tokens if the price falls below the value of the monitored fiat currency. If the price exceeds the required value of the pegged currency, then new tokens come into circulation in order to reduce the cost of the stablecoin.
You may have heard of this category of tokens called unsecured stablecoins.
From a technical point of view, this is an incorrect statement, since their value is provided by a certain mechanism, which in its qualities is analogous to the collateral, which is a strong distinguishing element from the previous types.