Purchasing USD Coin won’t generate any returns for investors, as it is intended to be a stablecoin. So the advantage of this crypto is more about its usage, as there isn’t an expected price appreciation with this coin. “Digital asset market participants can interact with or acquire USDC via trading USDC denominated pairs on an exchange, or directly interacting with USDC’s issuer,” says Marco Manoppo, research director at https://www.tokenexus.com/ Digital Asset Research. And when you choose to sell 1 USDC for fiat currency, the coin is “burned” when you make the transaction. “Centre works with auditors and government regulation with a transparent and clear description of the reserves available to back the peg to the U.S. dollar,” Bumbera says. To maintain USDC’s stable value equal to $1, USDC is backed by cash and short-term U.S. government bonds as collateral.
What Terra’s Meltdown Means for Centralized Stablecoins Tether and USDC
The year-to-date return on Bitcoin is -35% as of this writing, for example. Meanwhile, the value of USDC has remained almost completely flat year to date. The lowest trading price that USDC has fallen to within the last 52 weeks is $0.995, a slight dip below its dollar peg. Launched in 2018 by Centre, how to buy usdc a consortium founded by Circle and Coinbase, USD Coin was created as a regulated stablecoin that runs on blockchain technology. Several experts have called USDC a safer stablecoin since the Centre consortium remains dedicated to its efforts around compliance and regulations by the government.
What is the market cap of USDC (USDC)?
- But of course, no investment is risk-free, and you are taking a little bit of risk on borrowers in gaining a yield on USDC.
- You can also redeem USDC via exchanges relatively quickly, thanks to its high liquidity and trading volume.
- Since USDC runs on Ethereum and other blockchains, it does not require its own hashing algorithm and instead can be secured by the chains it lives on.
- USDT has been at the receiving end of multiple investigations as its backer is not as transparent about its dollar reserves backing its peg to the US dollar.
- USDC can also be used to send money across the world fast and at a low cost.
It’s a bit difficult to give an exact number here — as in theory, the number of USDC that can exist is limitless. New coins are created in line with demand, whenever someone wants to purchase one with their humble dollar. Overall, the goal is to create an ecosystem where USDC is accepted by as many wallets, exchanges, service providers and dApps as possible. You can make passive income with USDC by lending it to other crypto investors.
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A few lending programs will pay you interest for lending your USDC. But of course, no investment is risk-free, and you are taking a little bit of risk on borrowers in gaining a yield on USDC. Meanwhile, USDC’s value has stayed relatively stable over its life, although there may be some short-term volatility during extreme market periods, Manoppo says.
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Stablecoin Markets Shift as Binance Begins USDC Conversions
The Big ‘Winner’ From the Crypto Crash? USDC Stablecoin
- USDC is commonly bought with Bitcoin — and if it’s your first time buying Bitcoin, be sure to check out our comprehensive guide here.
- USD Coin and Tether (USDT) together account for 80% of the capitalization of the global stablecoin market.
- The Centre consortium envisioned the USDC as a fully collateralized, price-stable digital asset that can be used more conveniently than fiat currency.
- Meanwhile Circle, founded in 2013 and backed by Goldman Sachs, is an official Money Transmitter, making both of them an open financial book.
- You can purchase USDC on several platforms, including Circle’s own, using fiat dollars.
- Thanks to its issuance via smart contracts on several major blockchains, USDC is one of the easiest and most common onboarding paths into the world of decentralized finance (DeFi).