Understanding Cryptocurrency and Stablecoins

Overview

Digital currencies are becoming more common in business payments, but not all cryptocurrencies behave the same way. The biggest distinction is between traditional cryptocurrencies (like Bitcoin) and stablecoins (like USDC).

This article explains how they differ and how each applies to your Slash account.

What is Cryptocurrency?

Cryptocurrency is a broad category of digital assets that use blockchain technology to record and verify transactions. When people use the term cryptocurrency, they are often referring to digital assets whose value changes based on market demand. Common examples include Bitcon (BTC) and Ethereum (ETH)

Key characteristics of exchange-traded cryptocurrencies:

• Market-based pricing: Their value is not fixed to a fiat currency or other reference asset.
• Price volatility: Prices can move up or down quickly, sometimes within hours or days.
• Use beyond payments: They are often bought, held, or traded as assets, not just used to send money.

What are Stablecoins?

Stablecoins refer to a specific type of cryptocurrency designed to maintain a stable value by being pegged to a reserve asset—typically the U.S. dollar. One stablecoin equals one dollar, making them predictable and practical for everyday business transactions. Common examples include USDC and USDT, which are both supported by Slash.

Key characteristics of stablecoins:

• Designed for price stability: They are intended to maintain a consistent value, usually around 1 USD per coin.
• Used for transactions: They are commonly used to send, receive, or hold digital dollars on blockchain networks.
• More predictable for business use: their value is easier to account for when paying vendors, moving funds, or managing balances.

Cryptocurrency vs. Stablecoins: At a Glance

Need More Help?

If you have questions about using stablecoins with your Slash account, contact our support team through the Help section in your dashboard or email support@slash.com, or use the in-app chat in your Slash dashboard.