Altcoins Talks - Cryptocurrency Forum
Cryptocurrency Ecosystem => Stable Coins Forum => Topic started by: amberrrr789 on November 15, 2022, 06:21:05 PM
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USD Coin (USDC), a cryptocurrency, is designed to have a fixed value of $1 USD. Assets like USD Coin and Tether are part of a larger category of cryptocurrencies known as stablecoins, which use a number of techniques to help maintain a stable price, such as pegging its value to fiat currencies or commodities (USDT). Stablecoins are an essential tool for users of digital assets to profit from the relative stability of the dollar or other stable assets in the volatile cryptocurrency market.
The USDC stablecoin was created by the organization CENTRE, which was established by the FinTech firm Circle and the cryptocurrency exchange Coinbase. Circle received $110 million and first disclosed its ambitions to create USD Coin on May 15, 2018. The USDC coin made its debut on the Ethereum blockchain as an ERC-20 token, but it has since been added to the Solana, Stellar, Avalanche, Flow, Tron, and Algorand blockchains as well.
At 44 billion as of November 15, 2022, USDC had the second-highest market cap among stablecoins. According to the first report from CENTRE, which was released in October 2018, there were around 127 million USDC in circulation. By 2022, there will be about 44 billion.
Is USDC transparent enough?
USDC is secured by cash and short-term US government bonds. Each used USDC token is backed by $1 in accounts at authorized U.S. financial institutions. These accounts have been audited by the American accounting firm Grant Thornton LLP. In May 2022, Circle said it would begin publishing weekly attestation reports. By revealing the precise sum of real money backing the stablecoin, they help to increase the legitimacy of USDC.
What is the story behind USDC 2.0?
The CENTRE consortium unveiled the updated version of USDC in August 2020. Increased functionality is provided by USDC 2.0 for digital wallets and other stablecoin-supporting services. Owners of USDC and other Ethereum-based tokens previously had to pay a commission to complete transactions. To buy gas, customers must always have ETH in their accounts.
It allegedly impeded wider acceptance, according to its designers. To overcome this difficulty, CENTRE has included a gasless send feature to the USDC. Because of this, wallet creators can charge users directly in USDC tokens rather than ETH and pay commissions on their behalf. The platform's creators built a public USDC smart contract to integrate the support. Developers can decide whether to charge for this service themselves or through a third-party provider.
The consortium team claims that gas-free transmit will significantly improve USDC's ability to conduct payments, peer-to-peer exchanges, and online business. All previous protocols are fully backwards compatible with the update. This shows that USDC 2.0 has no impact on existing USDC-connected programs, exchanges, and wallets.
How is USDC put to use?
As a means of settlement. You may rely on USDC to hold its value over time without going through the occasionally extreme price swings that are typical of cryptocurrencies if you want to send money using one.
To spark curiosity. Some platforms offer users interest in return for USDC deposits. It's critical to keep in mind that this activity involves some risk. Additionally, DApps and DeFi also support USDC. Among others, USDC is used by Aave, Compound, Dharma, OpenSea, and numerous DApp and DeFi protocols.
Establishing a link between the world of cryptocurrencies and conventional payment processors.
Circle has collaborated with two of the largest payment networks in the world in addition to a few well-known payment processors. Businesses connected to the Visa network will be able to start accepting USDC once Circle and Visa partner in December 2020. In July 2021, Mastercard (NYSE:MA) announced plans to start accepting USDC as a form of payment. Payment processors Stripe and Checkout.com both declared support for USDC in 2022.
What sets USDC and USDT apart from each other?
USD Coin is usually seen as the safer option due to its openness. The reserves have been verified in reports from the management from the company's formation. On the other hand, Tether Limited withheld its reserve information for years. It has also encountered legal difficulties as a result of its lack of transparency. Unbacked Tether issuances harmed the bitcoin market by $1.4 trillion, claims one lawsuit.
Tether's advantage is its size. Its market cap is substantially larger than USDC's, and its trading volume is bigger. It will typically be a little easier to exchange Tether for other cryptocurrencies because of its high trading volume.
In the majority of U.S. states, USDC is regarded as a stored value instrument, which has the advantage for you of being more closely regulated. Likewise, Tether hasn't yet undergone an unbiased audit.