A crypto-collateralized stablecoin is the same thing as a crypto-backed stablecoin: a token designed to hold a steady value, usually one US dollar, whose backing consists of other cryptoassets locked in smart contracts rather than cash or bank deposits. The main entry covers how these coins work, their history and their risks.
Both names are used interchangeably. Because the collateral itself is volatile, these stablecoins are normally backed by more value than they issue, a feature called over-collateralization. If the value of a user's collateral falls too far, it is sold automatically to protect the coin's backing. The best-known example is Dai, created through the Maker Protocol.
They differ from a fiat-backed stablecoin, where an issuer holds reserves in traditional assets, and from algorithmic designs that rely mainly on supply adjustments.