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Cryptocurrencies

Usdc

USDC (USDC)

USDC, or USD Coin, is a stablecoin that operates on the Ethereum blockchain and is pegged 1:1 to the value of the US dollar. It was launched in 2018 as a product of the Centre Consortium, an open-source technology initiative supported by Circle and Coinbase. USDC is now available on various blockchains, including Algorand, Avalanche, Solana, Stellar, and TRON. Unlike minable cryptocurrencies like Bitcoin, USDC is backed by US dollars held in reserve bank accounts. Each USDC token is backed by one US dollar, and these funds are regularly monitored and audited. USDC is tradable on both centralized and decentralized exchanges such as Binance, Coinbase, and Uniswap.

Tokenization process

The process of converting US dollars into USDC is known as tokenization, which involves several steps. Initially, a user sends USD to the token issuer's bank account. The issuer then uses a USDC smart contract to generate an equivalent amount of USDC, which is sent to the user. The corresponding USD is held in reserve. To redeem USDC for USD, the process is reversed, with the user requesting redemption, the issuer processing the exchange, and the USD being returned to the user's bank account.

History of USDC

USDC was developed by the Centre Consortium in partnership with Circle and Coinbase. It was launched on September 26, 2018, and initially supported by Coinbase. By the end of 2021, the circulation of USDC had grown to over 51 billion. Circle, founded by Jeremy Allaire and Sean Neville in 2013, has played a key role in USDC's development. In April 2020, Coinbase invested $1.1 million in USDC stablecoins into the pools of popular DeFi applications like Uniswap. In November 2020, Circle partnered with Airtm and the Venezuelan government to deliver aid using USDC.

Use cases of USDC

USDC serves various purposes due to its price stability:

    usdc background
    Ticker USDC
    Category Stablecoins
    Website https://www.circle.com/en/usdc
    Twitter @circle
    Contract Addresses
    ethereum 0xa0...48Copied!
    zksync 0x1d...d4Copied!
    optimistic-ethereum 0x0b...85Copied!
    polkadot 1337
    tron TE...z8Copied!
    near-protocol 17...a1Copied!
    hedera-hashgraph 0.0.456858
    base 0x83...13Copied!
    arbitrum-one 0xaf...31Copied!
    polygon-pos 0x3c...59Copied!
    aptos 0xba...3bCopied!
    sui 0xdb...DCCopied!
    algorand 31566704
    avalanche 0xb9...6eCopied!
    stellar US...VNCopied!
    solana EP...1vCopied!
    celo 0xce...8cCopied!
  • Hedge against volatility: Investors can stabilize their portfolios by holding USDC during volatile market periods.
  • Pricing in fiat money: It allows for the pricing of digital assets in fiat money on cryptocurrency exchanges.
  • Stable price-pegging: USDC can represent equity ownership or fund investments without price fluctuations.
  • Remittances: Enables cross-border transactions without a bank account.
  • U.S. dollar exposure: Non-U.S. investors can gain exposure to the U.S. dollar.
  • Hedge against inflation: Protects value against local currency inflation.
  • Global crowdfunding: Allows startups and non-profits to raise stable funds globally.
  • Blockchain interconnection: Facilitates payment system integration across blockchains.

    • Transparency and regulations

    USDC adheres to U.S. money transmission laws and employs established auditors. Circle, a registered Money Transmitter, ensures financial transparency. The project is also regulated by the Financial Conduct Authority in the UK, ensuring accountability.

    Security

    USDC's security is maintained through regular audits by Grant Thornton LLP, which provides monthly attestations on the US dollar reserves backing USDC tokens.

    USDC collaborations and developments

    USDC x Cosmos

    Circle is working with Strangelove Labs and other partners to launch USDC on the Cosmos network, making it accessible via the IBC protocol. This initiative is expected to enhance interchain security and availability.

    USDC payments on Visa

    In March 2021, Visa announced plans to use USDC to settle transactions on the Ethereum network. This initiative aims to enable clients to directly convert digital assets to fiat currencies on Visa's platform.

    Circle assumes control over USDC

    On August 21, 2023, Coinbase announced an investment in Circle, granting Circle full control over USDC's governance and operations. This restructuring aims to streamline operations and enhance Circle's accountability as the USDC issuer.

    Solana Pay enables USDC payments through Shopify

    On August 23, 2023, Solana Pay integrated with Shopify, allowing USDC payments. This integration offers businesses cost-saving benefits and enables loyalty programs through NFT tokens.

    USDC launches on new platforms

    On September 5, 2023, USDC was introduced on both Optimism and Base, enhancing liquidity and providing stablecoin solutions for various blockchain applications. These integrations aim to expand USDC's role in payments, trading, and digital savings.