Stablecoins: dollars that live on a blockchain
Last reviewed: July 2026
A stablecoin is a token designed to always be worth the same — almost always, a dollar.
It's the asset you'll use the most in practice, and it's what makes crypto useful for something concrete: sending money, getting paid, saving without the volatility.
Why they matter
"I'm sending you 100 USDC" is the same as saying "I'm sending you 100 dollars." But "I'm sending you 0.000012 BTC" doesn't mean anything to anyone, and by the time the transaction confirms it's worth something else anyway.
The ones you'll see
| Stablecoin | Worth | Who issues it | Backing |
|---|---|---|---|
| USDC | $1 USD | Circle | US dollars and Treasury bonds |
| USDT | $1 USD | Tether | Dollars, bonds, and other assets |
| EURC | €1 EUR | Circle | Euros in European banks |
| PAXG | 1 ounce of gold | Paxos | Physical gold stored in London |
| MXNB | $1 MXN | Bitso | Mexican pesos |
USDC vs USDT: which to use
It's the most common question. The practical answer:
| USDC | USDT | |
|---|---|---|
| Transparency | Monthly audits, simple backing | Historically more opaque, more varied composition |
| Regulation | US company, heavily regulated | Offshore |
| Liquidity | High | The highest in the market, especially outside the US |
| In Latin America | Widely used, mainly via Coinbase and Bitso | Dominant in P2P and on Asian exchanges |
In practice: use whatever your exchange and counterparty use. If you can choose, USDC. If you're buying P2P in Latin America, you'll probably end up in USDT because that's where the liquidity is.
They're not the same token
USDC and USDT are different tokens from different companies. That's why pairs like USDC/USDT exist to swap between them — and why sending one when the other was expected can cause problems.
What almost no one tells you: they can freeze you
Stablecoins have a pause button
Circle and Tether have a blacklist function in their contracts, and they use it. If your address ends up on that list, your USDC or USDT gets frozen in your own wallet, even if you have the seed phrase, even if you've never done KYC, even if you're using DeFi.
They've frozen hundreds of millions of dollars at the request of authorities.
This isn't a reason not to use them —it's the flip side of someone guaranteeing the value— but it changes the mental model:
No one can freeze them. There's no issuer to ask.
The issuer can freeze them. There's a company with a button.
You can verify it yourself: look up the contract on the explorer, the Contract → Read Contract tab, and check whether it has functions like isBlacklisted or pause. See how to verify it.
"Backed" doesn't mean "the same as a dollar in the bank"
When you hold USDC, you don't hold a dollar: you hold Circle's promise to give you one. That promise is only as good as the assets behind it and the company's solvency.
Serious issuers publish periodic audits: Circle, Tether, Paxos.
The ones that broke
Not all stablecoins are backed by real dollars. Some tried it with algorithms:
UST (Terra) reached $18 billion in value and promised to hold the dollar peg through an automatic mechanism paired with another token. In May 2022 the mechanism broke down within days and it went to zero. A lot of people lost everything they had, including people who believed they were "in dollars, no risk."
The warning sign
If a stablecoin offers you a high yield just for holding it, ask yourself where that yield comes from. In UST's case it was ~20% a year, and it came from a subsidy that wasn't sustainable.
A dollar doesn't yield 20% risk-free. Ever.
How they're used in practice
- To get paid and to pay: their best use. See Receive crypto
- To avoid exposure to volatility: you sell into a stablecoin and stay there
- To trade: almost every trading pair is against USDC or USDT
- To save in dollars from a country with a weak currency: it's what gives crypto real traction in Latin America (see on-ramps by country)
If you came looking for something else:I'm about to receive crypto · Buying for the first time · Crypto in Latin America