USDC (USDC) Price Today

 What is USDC?

USD Coin or USDC is a stablecoin that is fully backed by U.S. dollar assets where one USDC coin has pegged to a value of one U.S. dollar on a 1:1 ratio. The value of USDC remains stable, thus making it a stablecoin.

Stablecoins are generally backed by reserve assets such as dollars or euros to gain price stability. The price stability of USDC differs sharply from the notorious price changes of other digital currencies like Bitcoin and Ethereum.

Every unit of this digital currency in circulation is backing up by $1, held in reserve, a mix of cash and short-term U.S. Treasury bonds. The Centre consortium behind this asset claims that regulated financial institutions issue USDC.

The stablecoin was initially made available on a limit basis in September 2018. USD Coin is designed for a world where cashless transactions are becoming more common.

Different use cases have been unveiling for the USD Coin. The stablecoin not just provides a haven for crypto investors at times of greater market volatility, but those behind the stablecoin claim that it can also enable businesses to accept payments in digital assets and shake up an array of sectors like decentralized finance and gaming.

Overall, the aim is to build an ecosystem where USDC is accepted by as many exchanges, wallets, service providers, and dApps as possible.USDC is compatible with various blockchains. Some of these include; Ethereum, Algorand, Solana, Stellar, and TRON.

Who founded the USD Coin?

The Center operates USD Coin. It is a consortium co-found by the crypto exchange Coinbase (COIN) and a fintech company Circle.

In 2020, Circle and Coinbase jointly announced a major update to USDC’s protocol & smart contract. These enhancements make it easier for USD Coin to be useful for everyday payments, commerce, and peer-to-peer (P2P) transactions.

What makes USD Coin (USDC) unique?

The stablecoin market has become incredibly crowded over the last few years. But the USD Coin has managed to give tough competition to rivals in several ways.

One of them concerns transparency and assuring users that they can withdraw 1 USDC and receive $1 in return without any issues. To this end, it says a prominent accounting firm is tasked with verifying the cash levels held in reserve and ensuring this matches up with the number of tokens in circulation.

Unlike some crypto ventures, Circle and Coinbase have also achieved regulatory compliance. And this has helped pave the way for global expansion. 

Coinbase briefly considered diversifying the funds backing USDC but retracted that proposal after heavy backlash from the community. The transparency over the origin of its funds has been a significant reason for USDC’s success. Unlike its competitor USDT, which has been embroiling in continuous investigations, USDC has never been into accusations of wrongdoing. That has led to USDC gulping up much of USDT’s superiority in the stablecoin market. Although USDT supervised a 74%:16% lead in market share in February 2021. And Also this has diminished to a 45%:30% lead in February 2022.

How Much USD Coin Asset Reserves are in Holdings?

Following the TerraUSD crash in May this year, stablecoin issuers have been under serious investigation. This was concerning the quality of the reserves backing their tokens. In a transparency move, Circle Internet Financial LLC (Circle), the USDC stablecoin issuer, announced its reserves report on July 31, 2022.

As per the report, the total USDC reserves owned by the company comprised US Treasury Securities worth $42.3 billion and total cash deposits of $12.2 billion. Leading global accounting firm Grant Thornton released the monthly reserve report.

Later, on August 24, 2022, the accounting firm released an independent attestation, that read: “In our opinion, the Reserve Information in the accompanying USDC Reserve Report as of July 31, 2022, is fairly stated, based on the criteria set forth in the USDC Reserve Report, in all material respects.”

The world’s leading asset manager shows interest in USDC

USDC has continued to differentiate itself from other stablecoin projects in an apparently loosely regulated space by developing relations with conventional financial institutions.

After a $400 million funding round, which witnessed participation from BlackRock, Fidelity, Fin Capital, and Marshall Wace LLP, the world’s largest asset manager, BlackRock disclosed that it had struck a broader strategic partnership with Circle, including exploring capital market applications for USDC.

In addition to entering into a partnership with the largest asset manager in the world, the stablecoin provider has struck other deals with notable names from traditional finance. In March, there was this news that America’s oldest bank BNY Mellon would act as the primary custodian of the assets backing USDC stablecoins. Meanwhile, a press release revealed that BlackRock would be the direct asset manager of USDC cash reserves.

Is there a fixed number of USD Coins (USDC) that are there in circulation?

It is difficult to give an exact number of USD Coins (USDC) in circulation, as in theory, the number of USDC that can be there is limitless. The creation of new coins depends on demand, whenever someone wants to buy one with their modest dollar.

Meanwhile, there have been elements that have allowed the USD Coin to enjoy a sudden rise in popularity over the years, particularly in 2020. One among them is the sudden, intense rise in the popularity of decentralized finance. USDC is a common sight on many DeFi protocols, given how it acts as an onramp to the broader ecosystem.