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Unstable and stable are merely nomenclatures used by the Linux community. Another common method is to name all the unstable builds as odd version numbers and stable ones as even numbers.
The word unstable and stable do not reflect how well the program actually runs. Stable merely means it has been extensively tested and should run without issue. Unstable means that it hasn't been thoroughly tested and although it should run fine, there's always the chance it'll freeze your machine or make it catch on fire, though very unlikely.
Yes, I was confused at first too when I started to get into Linux.
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