USD Coin $USDC Wiki: Coin History, Techstack, and Crypto News

The USD coin is a stablecoin pegged on the US dollar. A stablecoin is a cryptocurrency that is matched 1:1 to a traditional currency. The managers of the USD coin are a consortium called Centre which includes members from the digital cryptocurrency exchange Coinbase. The consortium was formed by Circle.

New USDC coins are minted whenever people buy them and they are removed from circulation when people sell them.

History

USD coin was first announced by Circle on the 15th of May 2018. Circle is a peer-to-peer payment processing company. Circle raised $110 million during the time of the announcement of the coin.

The Centre Consortium was created in 2018 by Circle to manage the USDC. The coin was launched on 26th September 2018 with 127 million USD coins in circulation.

Visa announced they would accept the use of USDC to settle transactions on their payment network.

Biggest Claims to Fame

As a stablecoin, it is a safe way to hold and own cryptocurrency. Since the value of the USDC is unchanging, new users of cryptocurrency have a safe way to experience cryptocurrency use without having to worry about the market dropping suddenly and having them lose their money.

Centre releases monthly attestations of the USD coin using Grant Thornton LLP, a reputable accounting firm. The attestations provide the number of USDC in circulation and the number of reserves that back it. This shows there are funds backing every USDC to the dollar.

The USD coin has partnerships with Visa and MasterCard. In September 2020, a partnership between Visa and Circle was announced where clients could use USDC to carry out payments in business transactions. MasterCard announced tests for whether the USDC can be used as a payment method. Twitter has announced plans to begin testing the option of using USDC as a payment option for content creators. Stripe has also announced that it will support payments made using USDC.

USD coin is supported across several blockchains. Both developers ad users can use USDC to make payments on other blockchains which is difficult to do with other cryptocurrency coins or tokens. Blockchains that support the USD Coin include Ethereum, Solana, Steller, Hedera, and many more.

Biggest Criticism

Circle has made claims that USD coin is backed by the US dollar. They have changed the wording of this to backed by fully reserved assets and backed by fully approved assets. The changes they have made to the wording and being unclear on what exactly the approved assets are has made people suspect that they are not fully backed 1:1, which has in turn made people suspicious of putting their money into a stablecoin that may not be fully backed.

The attestations given by Circle for the USDC that are carried out by Grant Thornton LLP are not audits. Grant Thornton LLP does not investigate whether the information they have from Circle is correct. This means there is a possibility that the information is inaccurate or incorrect. There are worries that Circle may be releasing monthly attestations to make people comfortable enough not to ask for an official audit of the records and finances the USDC is backed to.

The USD coin runs the risk of not being able to match the value of the US dollar 1:1 in case any of the backing companies go bankrupt. The companies and institutions that provide the finances to back the stablecoin such as Coinbase ad Circle going bankrupt would cripple USDC. Since the USD coin fully relies on the companies to provide banking, such a thing is likely to cause the value of the USDC to lower.

Team

USDC was created by Circle. Circle is a peer-to-peer technology company that deals in payment transactions. Circle was created by Jeremy Allaire and Sean Neville in October 2013 and started out dealing with traditional currency. Circle received it’s Bit License in September 2015 and functioned as a Bitcoin wallet to trade Bitcoin until 2016. Circle announced the formation of the USD coin in May 2018.