What is a stablecoin? How they hold their value, and why money apps care
By SendPay Business · · 2 min read
A stablecoin is a crypto token designed to keep a steady value, usually one US dollar or one euro. It moves like crypto, across borders at any hour, but aims to avoid the big price swings of coins like bitcoin.
How they try to stay stable
The largest stablecoins, such as USDT and USDC, are backed by reserves: the company that issues them holds cash and short-term government debt, and promises to swap each token for one dollar. Others try to hold their value with crypto collateral or with code alone, which has failed badly in the past.
What people use them for
- Moving money in and out of crypto trades without going back to a bank each time.
- Sending value across borders quickly, at any time of day.
- Holding a dollar-like balance in countries where the local currency is falling.
The risks
A stablecoin is only as good as its reserves and the firm behind it. If people doubt the reserves, the price can slip below one dollar. Stablecoins aren't bank deposits and aren't covered by deposit protection schemes.
The rules
The EU now regulates stablecoin issuers under its MiCA crypto rules, and the UK and other countries are bringing in their own. If you plan to offer crypto in your app, you'll usually need a licence or registration, or to work with a partner that has one.
Build it
Create your own financial platform.
Pick a template, name it, brand it, preview every page before you pay. Your brand, your users, your fees.
Build my platform →Questions people ask
How much of my portfolio should be in stablecoins?
Set a target mix and see how much of each holding to buy or sell.
Rebalancing calculator →Is a stablecoin the same as a bank balance?
No. It's a token backed by the issuer's reserves, not a deposit protected by a government scheme.
How do I work out a crypto trade's real profit?
The free calculator includes buying and selling fees and shows the break-even price.
Crypto profit calculator →Can I launch my own crypto app?
Yes. A SendPay crypto exchange platform, powered by licensed partners, is free to design and preview; you only pay when you publish.
Start a crypto wallet app →Read next
This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.