USD Coin

This article is about the cryptocurrency. For United States coinage, see Coins of the United States dollar.

USD Coin
Denominations
CodeUSDC
Development
White paperUSDC White Paper [dead link‍]
Initial releaseSeptember 2018
Developer(s)Circle
Website
Websitewww.circle.com/en/usdc

USD Coin (USDC) is a cryptocurrency stablecoin pegged to the United States dollar. With $41 billion in assets under management,[1] USDC is issued by Circle and is distinct from a central bank digital currency (CBDC).[2]

Usage

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USDC operates as an Ethereum ERC-20 token and is also available on several other blockchain platforms such as Polygon.[3][4] Visa initiated a pilot program to send USDC via the Solana blockchain to payment firms Worldpay and Nuvei, who could then transfer payment to merchants.[5]

Reserves

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Until mid-2021, Circle stated that each USDC was backed by either one U.S. dollar in reserve or by other "approved investments", though the specifics of these investments were not disclosed. In June 2021, Circle updated its website wording from "backed by US dollars" to "backed by fully reserved assets".[6]

As of 2020, USDC reserves were regularly attested (but not audited) by Grant Thornton, LLP,[7] and as of 2021, the monthly attestations could be found on the Centre Consortium's website.[8]

History

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Circle announced USDC on May 15, 2018,[7] and it was subsequently launched in September of the same year by Centre, a consortium formed through a joint venture between Circle and Coinbase.[9]

On March 29, 2021, Visa announced its support for USDC, enabling the cryptocurrency to be used for selling transactions within its payment network.[10]

In July 2022, Circle reported that the circulation of USDC had reached $55 billion.[11]

On March 11, 2023, USDC temporarily lost its peg to the US dollar after Circle revealed that $3.3 billion dollars, about 8% of its reserves, were jeopardized due to the collapse of Silicon Valley Bank the day before.[12] USDC regained its dollar peg four days later.[13]

In August 2023, Circle and Coinbase dissolved the Centre Consortium, the entity responsible for managing USDC since 2018. This decision granted Circle full governance over USDC.[14]

In February 2024, Circle discontinued USDC on the TRON blockchain in February 2024 following a risk management review. Although the minting of new USDC tokens halted on 21 February 2024, customers have until February 2025 to transfer USDC to other blockchains.[15]

According to data compiled by Visa, USDC overtook Tether in stablecoin transaction volume in 2024.[16]

See also

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References

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  1. ^ Nina Bambysheva (11 December 2024). "Circle And Binance Become A Stablecoin Power Couple". Forbes. Retrieved 15 December 2024.
  2. ^ Arnold, Martin (15 May 2018). "China bitcoin miner Bitmain leads $110m investment in Circle". Financial Times. Archived from the original on 9 November 2020. Retrieved 6 June 2020.
  3. ^ "Centre | USD Coin". www.centre.io. Retrieved 16 September 2022.
  4. ^ "USDC to be available on 15 blockchains after adding 6—including Base, Optimism, and Polygon PoS—over next 2 months". Fortune. Retrieved 28 February 2024.
  5. ^ "Visa to send stablecoin USDC over Solana to help pay merchants in crypto". Fortune Crypto. Retrieved 19 September 2023.
  6. ^ Venkataramakrishnan, Siddharth (9 July 2021). "Circle listing will test top stablecoin's transparency over reserves". Financial Times.
  7. ^ a b Irrera, Anna (16 May 2018). "Circle raises $110 million, plans to create dollar-pegged cryptocurrency". Reuters. Archived from the original on 6 June 2020. Retrieved 6 June 2020.
  8. ^ Centre. "Centre | USD Coin". www.centre.io. Retrieved 7 June 2021.
  9. ^ Rooney, Kate (23 October 2018). "Cryptocurrency giants Coinbase and Circle form joint venture to boost adoption of dollar-backed digital coins". CNBC. Retrieved 7 January 2024.
  10. ^ Hussain, Noor Zainab (29 March 2021). "Exclusive: Visa moves to allow payment settlements using cryptocurrency". Reuters. Archived from the original on 30 March 2021. Retrieved 30 March 2021.
  11. ^ "A Letter from our CEO | Circle's Strength, Stability & Transparency".
  12. ^ Ge Huang, Vicky; Miao, Hannah; Ostroff, Caitlin (11 March 2023). "Circle's USDC Stablecoin Breaks Peg With $3.3 Billion Stuck at Silicon Valley Bank". The Wall Street Journal.
  13. ^ "US Bank Crisis Prompts Stablecoin Backer's Flight to Big Lenders". Bloomberg.com. 16 March 2023. Retrieved 19 September 2023.
  14. ^ "USDC to be available on 15 blockchains after adding 6—including Base, Optimism, and Polygon PoS—over next 2 months". Fortune Crypto. Retrieved 19 September 2023.
  15. ^ Wilson, Tom (21 February 2024). "Crypto firm Circle to end support for USDC stablecoin on Tron blockchain". Reuters. Retrieved 29 March 2024.
  16. ^ Shukla, Sidhartha (29 April 2024). "Circle's USDC Takes Lead in Stablecoin Transactions, Visa Says". Bloomberg.
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