# Stablecoin

> A token designed to hold the same value as a regular currency, usually the US dollar.

Canonical URL: https://fudfomo.co/glossary/stablecoin
Source: What The Block! Dictionary v1.0 (last updated 2026-04-25), browsable at https://wtb.fudfomo.co.

## Definition

A stablecoin is a cryptocurrency whose price is tied to something stable, most often the US dollar. The aim is to give you the speed and reach of crypto without the price swings of Bitcoin or Ether.

The most common stablecoins are backed one-for-one by cash and short-term government debt held by an issuer. Others are backed by other crypto held as collateral. They are widely used for trading, payments, and saving in countries with high inflation.

## Regulatory context

MiCA in the European Union sets specific reserve, disclosure, and authorisation rules for stablecoin issuers. Always check whether a stablecoin is authorised in your jurisdiction.

## Related terms

- [Token](https://fudfomo.co/glossary/token): A unit of value created on top of an existing blockchain like Ethereum.
- [DeFi](https://fudfomo.co/glossary/defi): Decentralised finance. Apps that offer lending, trading, and saving on a blockchain instead of through a bank.
- [Custody](https://fudfomo.co/glossary/custody): Who holds your crypto and the keys to it. Self-custody means you do, custodial means a company does.

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