What are the risks of stablecoins?
Jul 09, 2025 pm 06:57 PMAlthough stablecoins are regarded as a "safe haven" in the crypto world, they have five core risks: 1. Decoupling risk, price plummeting due to market panic or mechanism defects; 2. Reserve assets risk, opacity or depreciation of collaterals triggers a trust crisis; 3. Regulatory risks, policy changes may lead to transaction restrictions or asset freezing; 4. Problems with counterparty and operational risks, issuers or trading platforms threaten asset security; 5. Smart contracts and technical risks, code vulnerabilities may cause devastating blows.
Stablecoins are often regarded as a "safe haven" in the crypto world, but their "stability" is not absolute, and there are risks that cannot be ignored behind them. Understanding these risks is a key step for every investor to protect assets and make informed decisions.
Stablecoin Exchange in 2025:
Ouyi okx :
Binance binance:
Huobi htx:
The main risks of stablecoins
1. De-pegging Risk
This is the most core risk of stablecoins. Decoupling means that its market price deviates from the value of the anchor (usually $1). There are many reasons for decoupling. For example, when the market panic occurs and a large number of users sell stablecoins in exchange for fiat currencies, the issuer may not be able to meet all redemption needs, which triggers a run and leads to a price plunge. Algorithmic stablecoins (such as the former UST) may fall into a "death spiral" in extreme markets due to mechanism design flaws and completely lose value support.
2. Reserve Asset Risk (Collateral Risk)
The stability of fiat currency collateralized stablecoins (such as USDT, USDC) is based on whether their reserve assets are sufficient and safe. The risk here is: First, the reserve assets are opaque and the outside world cannot confirm whether they have really achieved 1:1 mortgage. Second, the composition of reserve assets is complex, which may include cash, treasury bonds, or commercial paper and other assets with low liquidity and security. Once there is a problem with reserve assets or the value of the shrinking, the repayment ability of the stablecoin will be questioned, which will trigger a trust crisis.
3. Regulatory Risk
The regulatory policies of countries around the world for stablecoins are still unclear, which is a huge uncertainty. Regulators may introduce new regulations at any time, such as requiring issuers to obtain specific licenses. Stricter regulation may cause certain stablecoins to be unable to trade on compliant exchanges (such as Binance, Ouyi, etc.), and even issuers may be required to suspend operations, and holders' assets may be frozen due to compliance review.
4. Counterparty & Operational Risk
This risk involves various entities associated with stablecoins. First of all, the issuer itself. If the company that issues stablecoins goes bankrupt, encounters hacking or is poorly managed internally, it may directly endanger the existence of the stablecoins. Secondly, the platform where you store stablecoins (such as an exchange or account) is also the counterparty. If there are security vulnerabilities or operational problems on exchanges (such as Huobi, Gate.io, etc.), the stablecoin assets you host on the platform are also at risk.
5. Smart Contract Risk
For stablecoins running on blockchains (especially decentralized stablecoins such as DAI), the core logic is determined by the smart contract code. If there are vulnerabilities or backdoors in smart contracts, they can be exploited by hackers, resulting in assets stolen or system crashes. This risk is technical and, once it occurs, it often causes a devastating blow.
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