What Are Stablecoins?
What a stablecoin is, how a peg is maintained, and why tracking a dollar is a target rather than a promise.
Stablecoins Explained
Stablecoins are the quiet infrastructure of crypto: most trading is priced in them and most transfers between platforms use them. They are also widely misunderstood as being equivalent to dollars.
These guides separate mechanism from safety. No stablecoin here is described as risk-free, and we publish no reserve figures of our own — current claims belong to the issuers and their regulators.
Guides
Types of Stablecoins
Three designs, three very different dependencies — and three different ways a peg can break.
Stablecoin Depegging and Risks
What depegging is, what has caused it, and the risks that exist even while a token trades at target.
USDT vs USDC
Issuers, disclosures, network availability and typical uses — plus the checks you should do yourself.
Sending Stablecoins and Choosing a Network
The same stablecoin exists on many networks. How to choose correctly and avoid the most expensive mistake in crypto.
Stablecoin Reserves and Attestations
Reserves, attestations, audits, custodians and redemption — how to read issuer disclosures and what they can and cannot tell you.
How a stablecoin actually holds its value
A stablecoin is a token whose issuer or protocol aims to keep it trading near a reference value, most often one US dollar. The peg is a target produced by a mechanism, not a property of the software. Fiat-backed designs rely on an issuer holding reserves and honouring redemptions with approved counterparties; crypto-backed designs rely on over-collateralisation and liquidation; algorithmic designs rely on incentives alone, which is the design that has failed most publicly.
The market price you see is set by traders, and it stays near the peg only while arbitrage is profitable and possible. When redemption is doubted, restricted or slow, the price can and does move away from the reference value.
High-level questions these guides answer
- Is a stablecoin the same as a dollar? No — it is a claim or a mechanism, not insured money, and holding one carries issuer, reserve, market and network risk.
- Why do the same token names appear on several networks? The same issuer deploys separate tokens on separate networks; sending across a mismatched network is the most common way people lose stablecoins.
- What does 'backed' mean? It describes what the issuer says it holds against tokens in circulation, disclosed in the issuer's own reporting, which changes over time.
- Why do stablecoins depeg? Redemption doubt, collateral shortfalls, liquidity gaps on a single venue, or a mechanism that never had real backing.
- Which one should I use? Whichever your counterparties support on the network you both use — we do not rank issuers.
What we will not tell you
- That any stablecoin is risk-free or guaranteed to redeem.
- Current reserve composition, which changes and belongs in the issuer's own reporting.
- That a stablecoin balance is equivalent to an insured bank deposit, because it is not.
- Which one to hold — that depends on what you and your counterparties actually support.
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Educational information only. Nothing here is financial, legal or tax advice. Read our data methodology for how our live figures are sourced.