Why are "stablecoins" called stable when they are pegged to fiat currencies like the dollar?We know that the dollar isn’t truly stable ,it loses about 7 to 10% of its value annually due to inflation. More and more, we notice that with the same amount of dollars, we can buy less and less. For example, if you had $10,000 in 2020, nominally you still have $10,000 today, but its purchasing power is only about $6,800.Maybe they are considered “stable” only in terms of losing less purchasing power
Why are they called “stable” when they are actually unstable?
They're called "stablecoins" because they're redeemable at a 1:1 ratio against the USD (regardless of inflation). Most of the centralized stablecoins are backed by real world USD reserves (usually in the form of treasuries and bonds), allowing them to maintain their value for long. Sometimes stablecoin issuers increase the supply of their stablecoin, but that doesn't mean they're printing money. Rather, they're increasing their USD reserves. Think of stablecoins as a sort of USD spot ETF or IOU.
People these days prefer convenience, so they will continue to use USD-backed stablecoins even if the USD itself gets weaker everyday. If you're worried about losing purchasing power, choose Bitcoin (or Gold) instead. We'll see how long will stablecoins last.