Stablecoin

A digital asset engineered to maintain a consistent value, typically pegged to a fiat currency such as the U.S. dollar or euro. Used for remittances, settlements, and on-chain liquidity management. Stablecoins introduce price stability to digital ecosystems that are otherwise volatile.

Stablecoins vs. Payment Stablecoins

The broader category of stablecoins historically operated with less regulatory oversight. Payment stablecoins are a kind of stablecoin, with the key difference being that payment stablecoins are an evolution of the stablecoin concept that is specifically defined and regulated under frameworks like the U.S. GENIUS Act and EU's MiCA. These regulatory frameworks are designed to ensure that payment stablecoins are less likely to become de-pegged from the corresponding fiat currency.

Why it Matters

Stablecoins bridge traditional finance and digital ecosystems by offering the speed and programmability of blockchain technology without the price volatility of cryptocurrencies like Bitcoin or Ethereum. They enable instant cross-border payments, reduce settlement times from days to seconds, and provide a stable unit of account for decentralized finance (DeFi) applications.

For businesses operating in global markets, stablecoins can reduce currency conversion friction and enable 24/7 treasury operations. They also serve as a crucial on-ramp and off-ramp between fiat and digital asset markets, making them foundational infrastructure for modern payment systems and digital asset strategies.