What is the difference between cryptocurrencies and stablecoins?

The main difference is price stability. Cryptocurrencies like Bitcoin, Ethereum, Ripple and Solana have a freely floating price that can rise or fall sharply, while stablecoins like USDC and USDT are pegged to a stable value such as the US dollar and barely move. Stablecoins are technically a type of cryptocurrency, but they are designed for stability instead of growth.

In short:

• Cryptocurrencies float in value and are mostly used for investing and network activity.
• Stablecoins hold a steady value and are mostly used for payments and saving value.
• One USDC or USDT is worth roughly one dollar at all times.
• For getting paid and bookkeeping, stablecoins are usually the easier choice.

What is a cryptocurrency?

A cryptocurrency is a digital asset that runs on a blockchain and has no central issuer controlling its price. Its value is set by supply and demand in the market. Bitcoin, Ethereum, Ripple (XRP) and Solana are well-known examples. Because the price floats freely, these assets can deliver strong gains, but also lose value quickly. That makes them popular for investing and for powering blockchain networks, and less predictable as a unit for everyday payments.

What is a stablecoin?

A stablecoin is a cryptocurrency designed to keep a stable value, usually pegged to a fiat currency like the US dollar. The two best-known stablecoins are USDC and USDT. Each is meant to stay worth about one dollar, backed by reserves or collateral held for that purpose. You get the speed and low cost of crypto, without the price swings. That is exactly why stablecoins are popular for invoicing, getting paid and moving money across borders. Read more about what stablecoins are.

What is the main difference between cryptocurrencies and stablecoins?

Which should you use to get paid?

For receiving payments, most freelancers and businesses prefer stablecoins. If you invoice a client for 1000 USDC, that amount is still worth about 1000 dollar when it arrives, so you are not exposed to price swings between sending the invoice and getting paid. Cryptocurrencies like Bitcoin or Ethereum can be a fine choice if you actively want exposure to their price, but for plain payment certainty, stablecoins win. See receiving payments in stablecoins and crypto for the full walkthrough, or how to sell stablecoins for euros when you are ready to cash out.

Frequently asked questions

Are stablecoins also cryptocurrencies?

Yes. A stablecoin is a type of cryptocurrency, but a distinct category that is built to hold a stable value rather than float with the market.

What backs a stablecoin like USDC or USDT?

Stablecoins are typically backed by reserves or collateral held to keep the value pegged, often in cash and short-term instruments. The exact backing depends on the issuer.

Are stablecoins safe?

Stablecoins have far less price volatility than other crypto, which makes them more predictable. They still carry risks tied to the issuer and the quality of the reserves, so it pays to use well-known stablecoins.

Can I get paid in stablecoins?

Yes. Stablecoins are one of the most practical ways to get paid in crypto, because the value stays stable between invoicing and payment.

Do I owe tax on stablecoins?

Selling or converting crypto, including stablecoins, can be a relevant moment for tax. The value at that point matters, so keep clear records and check with your accountant.

Keeping track of it all

Whether you get paid in cryptocurrencies or stablecoins, every transaction is recorded on the blockchain. STBL Admin connects to your wallet, non-custodial and read-only, pulls your full transaction history, converts each amount to its euro value at the right moment, and produces overviews you can hand straight to your accountant. This article is informational and not financial or tax advice.