Stablecoins are the lubricant that keeps the crypto industry rolling, but they come with distinct risks, according to blockchain analytics firm Chainalysis.

Broadly speaking, there are two types of stablecoins: centralized ones like Tether’s USDT and Circle’s USDC, and decentralized ones like Ethena’s USDe and Sky’s (formerly MakerDAO) USDS. Each comes with different types of risk, Chainalysis said in a new report, “The Security Risks of Stablecoins: How Hackers Exploit Centralized and Decentralized Issuers.”

Centralized stablecoins are backed by reserves held by their issuers, usually cash or short-term U.S. Treasuries.

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