Fiat Backed

You give me a dollar bill, I give you a token

Trusted custodians hold the value in dollars for each token they mint

Pros

Easy to understand
Inherent value backing

Cons

Centralized control
No on-chain guarantees
Requires trusted custodian
Custodians' ability to freeze your assets

Examples

USDC (0xa0b86991c6218b36c1d19d4a2e9eb0ce3606eb48)
USDT (0xdac17f958d2ee523a2206206994597c13d831ec7)
TUSD (0x0000000000085d4780B73119b644AE5ecd22b376)