Find The Best Stablecoin

Stablecoins play an essential role in the cryptocurrency ecosystem and over the past year there has been an explosion in available liquidity and trading volume.

New use cases for stablecoins are continuing to evolve. Interest accounts, loans, and margin funding are just the beginning as blockchain technology continues to advance.

Blockfer has provided the stablecoin comparison research for you in an easy to understand format. Review and analyze different types of stablecoins depending on the factors that matter most to you:

  • Is trading your main priority?
  • Is the ease of personal storage essential to you?
  • Are you willing to compromise privacy for greater liquidity and insurance?
  • Are you looking to redeem your stablecoins for fiat?

There are several considerations when researching stablecoins and Blockfer is here to help.

Find the best stablecoin for your needs below.

Note: We’re always looking to improve and update our content and data. Please don’t hesitate to contact us with any suggestions

USD Coin Logo

Rating9.5/10

Current Price:$1.00

Volume (24h):$216,962,603

Market Cap:$2,741,059,307

Circulating Supply:2,735,565,881

Collateral Type:Fiat-Backed

Base Currency:USD

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Paxos Standard Logo

Rating9/10

Current Price:$1.00

Volume (24h):$121,540,414

Market Cap:$245,053,153

Circulating Supply:244,951,954

Collateral Type:Fiat-Backed

Base Currency:USD

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TrueUSD Logo

Rating8.5/10

Current Price:$1.00

Volume (24h):$62,039,209

Market Cap:$331,118,901

Circulating Supply:330,738,664

Collateral Type:Fiat-Backed

Base Currency:USD

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DAI Logo

Rating8/10

Current Price:$1.01

Volume (24h):$45,604,152

Market Cap:$916,439,185

Circulating Supply:903,240,102

Collateral Type:Crypto-Backed

Base Currency:USD

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Paxos Gold Logo

Rating8/10

Current Price:$1,907.73

Volume (24h):$810,884

Market Cap:$66,112,399

Circulating Supply:34,655

Collateral Type:Commodity-Backed

Base Currency:GOLD

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Gemini Dollar Logo

Rating7/10

Current Price:$1.02

Volume (24h):$1,072,064

Market Cap:$14,627,362

Circulating Supply:14,379,252

Collateral Type:Fiat-Backed

Base Currency:USD

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Tether Gold Logo

Rating6/10

Current Price:$0.00

Volume (24h):$0

Market Cap:$0

Circulating Supply:0

Collateral Type:Commodity-Backed

Base Currency:GOLD

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Tether Logo

Rating5/10

Current Price:$1.00

Volume (24h):$18,817,236,756

Market Cap:$15,865,197,833

Circulating Supply:15,838,664,270

Collateral Type:Fiat-Backed

Base Currency:USD

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COLLAPSE

What are stablecoins?

Stablecoins are cryptocurrencies pegged to traditional assets. There are currently 4 main types of stablecoins:

  • Fiat Collateralized
  • Crypto Collateralized
  • Commodity Collateralized
  • Non Collateralized - (Algorithmic)

Detailed stablecoin information is available in our comprehensive Guide To Stablecoins.

How do stablecoins work?

It depends on the collateral mechanism in place for each type of stablecoin:

  • Centralized - Licensed and regulated stablecoins such as TUSD, PAX, & USDC issue or burn an ERC-20 token for every US Dollar that is deposited or withdrawn through their platform. Centralized stablecoins are collateralized by fiat deposits in bank accounts at a 1:1 ratio for every circulating stablecoin.
  • Commodity Backed - Values are pegged against the price of physical assets. Digix Gold Token (DGX) for example, enables purchasers to access tokenized gold as an investment.
  • Crypto Backed - Stablecoins like DAI use smart contracts to over-collateralize other crypto assets in order to maintain a 1:1 peg.
  • Algorithmic - Supply contracts and expands based on mathematical algorithms. Algorithm based stablecoins do not have collateral backing, and function similar to an automated central banking system.
Where can I buy stablecoins?

Buy With Cryptocurrency - Stablecoins are listed on all major cryptocurrency exchanges with 24/7 liquidity.

Buy With Fiat - Stablecoins can be purchased with fiat through the following options:

  1. Issuance Platforms - Such as TrustToken (TUSD) or Paxos Trust Company (PAX).
  2. Licensed Exchanges - Such as Coinbase, Kraken, and Bittrex.
What are the benefits of stablecoins?
  • Securely transfer fiat into crypto assets through licensed and regulated issuance platforms.
  • Trade crypto assets against stablecoin pairs on dozens of cryptocurrency exchanges.
  • Access to Crypto Loans using stablecoins as collateral.
  • Stablecoins can Earn Interest.
  • Hedge against market volatility in seconds by trading crypto assets into stablecoins.
  • Most stablecoins are ERC-20 compatible, users can store them in personal hardware wallets.
Are stablecoins anonymous?

This depends. Purchasing stablecoins with cryptocurrency on a decentralized exchange (or a centralized exchange in which the user has not completed KYC) can be relatively anonymous.

However, users looking to purchase (or redeem) stablecoins with fiat currencies directly from their respective issuers will need to complete the standard KYC (Know Your Customer) and AML requirements.

If anonymity is the priority, Blockfer recommends using DAI - the most decentralized stablecoin currently available.

How do stablecoins make money?

Stablecoins earn revenue for users by:

  • Margin Funding - Many exchanges act as a broker for margin traders looking to access additional trading capital at a premium. Users can loan their stablecoins to these traders with the exchange acting as an intermediary for an agreed upon interest rate.
  • Earning Interest - Users can deposit their stablecoins into cryptocurrency interest accounts with companies such as Nexo, Blockfi, and Celisus to earn interest on their balances.

Stablecoins earn revenue for issuers by:

  • Fees charged to customers during the process of redeeming stablecoins for fiat and converting fiat into stablecoins.
  • Centralized stablecoin issuers will often lend their fiat balance sheets to insured third party institutions and collect interest on the principal.
Can stablecoins earn interest?

Yes. Stablecoin owners can:

  • Lend their stablecoins to margin traders on exchanges, a process known as Margin Funding.
  • Deposit their stablecoins into cryptocurrency Interest Accounts.

More detailed information on this subject: Earning Interest On Your Stablecoins

Are there any risk with stablecoins?

There are risks with every financial instrument, including fiat currencies. It is important to remember that stablecoins are a new innovation still in the developing stages.

Risks may include:

  • Technology - Smart contract failure
  • Security - Hacks and theft
  • Regulation - Governments
  • Issuer Negligence - Insolvency
Are stablecoins securities?

Stablecoins and other cryptocurrencies are being closely monitored by financial regulators in the United States and around the world. At this time, there is no definite answer to this question.

Are there any stablecoins backed by gold or other precious metals?

Yes. Currently Digix Gold (DGX) offers an ERC-20 based token on the Ethereum blockchain. One DGX token is redeemable for one gram of gold.

What are the current use cases for stablecoins?
Can I store stablecoins in a hardware wallet?

Yes. Any Ethereum based ERC-20 issued stablecoin can be held in a personal Hardware Wallet. TrueUSD (TUSD), Paxos Standard (PAX), Gemini Dollar (GUSD), USD Coin (USDC), and DAI (DAI) are all ERC-20 compatible.

Blockfer strongly recommends the Ledger Nano S or Trezor hardware wallet for users with considerable stablecoin balances.

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