USD Coin (USDC) is a stable coin issued by CENTRE — a joint venture between Coinbase and Circle. The cryptocurrency is backed by U.S. dollar-denominated assets held at regulated and audited U.S. financial institutions. USDC has a variety of uses in the crypto marketplace but is commonly deployed in decentralized finance (DeFi) protocols and by traders.
What is USDC?
USD Coin (USDC) is a digital currency that is referred to as a Stablecoin (a coin with fixed value). You can always exchange one USD Coin for 1 US Dollar, which makes its price stable at $1. In Coinbase, eligible customers can receive rewards for each USD Coin they hold.
- Stable value: For customers with a US Dollar bank account, 1 USDC can always be exchanged for 1 US Dollar, giving it some price stability.
- Backed by US dollars: Each USDC has a certified US dollar behind it, which is kept in the bank.
- Powered by Ethereum: USD Coin is a token on the Ethereum platform, so you can store it in a suitable wallet like the Coinbase wallet.
- Global transactions: USC Coin is designed to help Dollars circulate globally from your crypto wallet to exchanges, businesses or other users.
- Above is an introduction to what USDC is – A stable coin created by Coinbase.
USDC runs on the Ethereum blockchain as an ERC-20 token. Each USDC token is 100% legally backed by a single USD held in accounts exposed to regular public reserve reporting. The underlying technology behind the USDC was developed in collaboration between Coinbase and the Circle platform.
What does USDC do?
Circle Company issues USDC with the following objectives:
- Bring transparency: Transparency brings trust, and trust is a necessary factor in giving users a reason to trust stablecoins to be stable over the long term. The source code of the USDC token is open, so all issuance and amount of USD coins are publicly disclosed and audited by leading auditing firms.
- Bring high liquidity: USDC is backed 1:1 with the US Dollar. Circle is one of the major technology companies in the US, it is valued at 3 billion USD, and is licensed to operate by the New York Stock Exchange (NYSE). Having a large company like Circle behind it as a launch pad will make it possible for this token to withstand periods of market volatility and reach the sustainable crypto space. In addition, investors can convert USD to USDC and vice versa at any time at a ratio of 1:1, only needing approval through Circle’s KYC/AML process. Circle also ensures that the USD Coin rate is always stable around 1 USD to provide the best store of value for investors.
- Build credibility: A brand everyone knows and loves will make USDC easier to accept.
USD Coin functions exactly like the US dollars, so you can spend it in pretty much any way you would with cash. The only thing you can’t do with a token is to fold it up and stuff it in your pocket.
Here are some of the most typical usage of USD Coin:
- Buy cryptocurrencies: You can trade USDC for any other type of crypto across many platforms. Note that since its value is fixed to the dollar, you’ll be subjected to exchange rate fluctuations when trading for other stablecoins.
- Make online purchases: One of the most significant advantages of using USDC is privacy. Transactions made on DEX are verified by smart contracts. They serve as a receipt of your payment so you can always keep track of your expenses. Commercial purchases are also possible. Companies that accept crypto payments usually take USD Coins as well. They include major corporations like Amazon, Microsoft, Visa, Tesla, and more.
- Earn Interests: Like the regular dollars, you can put USD Coins in an earning program, an exchange may offer, and make passive gains. Since it has a fixed value, you won’t have to worry about depreciation.
How to buy USDC?
USDC Price Statistics
Digital currency USD Coin listed at CoinMarketCap from September 9, 10. At the time of updating this article (February 2018, 9), the price of 2 USDC = $2019 USD, total market capitalization is 1 million USD.
The digital currency USD coin currently has a 24-hour trading volume of 36 million USD, the total supply is 287.400.099 USDC of which 272.991.961 USDC is circulating in the market. You can see USDC Rate We update in real-time 24/7 here to understand the price movement of this virtual currency.
Is USDC a good investment?
There are a few things that make USDC stand out from the crowd. These characteristics make USDC an attractive choice among crypto buyers, especially beginners.
1. Easily transferable
Two parties, both of whom have an Ethereum wallet, can transact USDC in a matter of seconds regardless of what time of day it is.
2. Compatibility with dApps
The crypto dApps, blockchain-based gaming, and exchanges ecosystem has been flourishing for the past several years. Since USDC is an ERC-20 token, any app that accepts this standard will accept USDC.
3. Transparency and security
Circle, an organization that is part of the Center Consortium, issues USDC. It has partnered with Coinbase for its USDC project. Plus, the transactions are audited by Grant Thornton LLP. Involvement of two reputable companies and audit by a leading accounting services firm ensure transparency in the firm’s affairs.
USDC is also a more secure way to hold funds instead of putting dollars in the bank, provided the person uses a private wallet. If someone gets their hands on a person’s login credentials, they can easily access accounts like PayPal or internet banking.
The server stores passwords as a hash. So, a hacker may be able to gain access to this hash, run cracking software and get the password. On the contrary, a hacker can get access to a person’s USDC only when they get their hands on the private key which is stored in the USDC-holder’s personal computer.
Unless a person is a well-known, big-ticket crypto investor, the chances of their personal computer being attacked are very slim.
This characteristic is common across all Stablecoins. The main reason why some people like Stablecoins is because they allow exposure to the crypto space without having to deal with the fear of massive volatility.
Conclusion and analysis
Ultimately USDC is one of the leading stable coins for a reason and continues to play a large role in the adoption of cryptocurrency globally. Built through a partnership with two reputable organizations Coinbase and Circle, and overseen by Centre, a leading open source project USDC remains one of the most trusted stable coin assets on the market today.
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DISCLAIMER: The Information on this website is provided as general market commentary, and does not constitute investment advice. We encourage you to do your own research before investing.