Fiat-backed stablecoins, for instance, are popular because they are as stable as the U.S. dollar (USD) or other widely accepted currencies. However, linking crypto to a federal currency makes fiat-backed cryptos a target for governmental regulation and overall more centralized – a certain trade-off when compared with algorithmic stablecoins, the most decentralized option.
Source: https://www.coindesk.com/learn/whats-the-point-of-stablecoins-understanding-why-they-exist/