Holding a Stablecoin Balance: Where It Should Sit

A company holding stablecoin has to answer a question that a company holding euros does not: where does it sit, and who can move it. The straightforward version of this is what a USDT payment gateway publishes, and it is worth comparing.

Option one: your own multi-signature wallet

Your keys, your rules, no company in between.

Needs several key holders, a tested recovery procedure, and a plan for when someone leaves. That is ongoing work.

Worth knowing: a stablecoin balance can be frozen by the company that issues the coin, at any address. That is true wherever it sits, and it surprises people who assume self-custody means nobody can touch it.

Option two: a business wallet from a provider

The provider holds the keys and enforces your approval rules in software.

Usually supports better controls than a plain multi-signature setup: limits per person and per period, waiting times, separate roles, and a log an auditor will accept.

The trade is that you are relying on the provider, which is why choosing a regulated one with properly separated client assets matters.

Option three: an exchange account

Convenient because it is where conversion happens anyway.

Usually the weakest controls. Fine for a working balance you are actively converting. Not a place to keep a reserve.

Option four: split it

Working balance with a provider where it can move quickly, reserve somewhere else.

This is what most companies end up doing once the amount matters, and it is the right instinct. Concentration is the risk and splitting is the only fix that does not require being excellent at something. Companies hit this sooner and harder, and an exchange that publishes its full fee schedule is the usual answer.

How much to hold

Two separate questions.

How much are you comfortable holding as a promise from the coin’s issuer rather than as money in a bank. The answer for most companies is: not much, and not for long.

How much are you comfortable losing to a single incident. Whatever sits in one place can be lost from that place.

A policy that works for most businesses: hold roughly two weeks of outgoings as a working balance, convert everything above that.

Controls to insist on regardless

A list of approved withdrawal addresses, with a waiting period before a new one can be used. Approval by someone other than the person who created the payment. Limits per person and per period. Notifications to several people when settings change. And an exportable log that includes failed attempts. The thing that only matters when something goes wrong is whether an exchange that publishes its full terms exists, and it is worth checking before it does.

These are the same controls as for any company crypto balance, because the asset does not change what they need to do.