Fiat-collateralised stablecoin
fiat-backed stablecoin
A stablecoin backed by off-chain fiat reserves (cash + equivalents) held by a regulated custodian.
Examples: USDC, USDT, USDP, PYUSD, FDUSD. Risk profile is concentrated in (1) issuer credit, (2) custody bank credit, (3) reserve-asset duration / liquidity, (4) regulatory standing. Compare with Crypto-collateralised stablecoin and Algorithmic stablecoin.
Related terms
- Crypto-collateralised stablecoinA stablecoin backed by on-chain crypto collateral, typically over-collateralised, with liquidation rules enforced by the protocol.
- Algorithmic stablecoinA stablecoin that maintains its peg through programmatic supply expansions and contractions rather than 1:1 reserves.
- ReservesThe assets backing a stablecoin's outstanding liabilities — for fiat-backed stables, predominantly cash + Treasuries.