USDC (USD Coin) is a US dollar-backed stablecoin that was developed by Circle in conjunction with Coinbase through their CENTRE consortium. CENTRE aims to facilitate the mainstream adoption of government-backed stablecoins.
There is a tight race in the stablecoin sector. Right now, these are the contestants: DAI, USDT (Tether), TUSD (TrueUSD), BITCNY (BitCNY), HAV (Havven), GUSD (Gemini Dollar), BITUSD (BitUSD), and USDC (USD Coin). Sorry if I left your favorite coin out, I feel like the point has been made. Competition is thick.
The function of a stablecoin is to do just that, be a coin that is stable. As the whole world knows, bitcoin, and more specifically, cryptoassets as a whole can be very volatile. This is why there is a race to find a good functioning stablecoin.
Three ways to collateralize stable coins
- Fiat-Backed Stablecoin/Collateralized off-chain: A coin that is backed by fiat reserves. USDC is a perfect example of this.
- Crypto-Backed Stablecoin/Collateralized on-chain: A coin that is backed by crypto-assets. DAI uses ETH as the primary collateral.
- Non-Collateralized Stablecoin/Seignorage Shares: an algorithmic central bank backed token. Basis is a project going down this stablecoin path.
USDC and transparency
As the CENTRE website explains:
USDC is an open source project that works within US money transmission laws, uses established banks and auditors and runs on blockchain technology via smart contracts. This is true financial and operational transparency.
Ethex.market shares similar views on transparency as all of our transactions are on-chain, making it easy for anyone to see what is happening on our exchange at any time. Some stablecoins have been criticized for their lack of transparency, most of which are fiat-backed stablecoins that have not gone through the due process of having an audit. Basically, these projects have failed to show that they have all of the $USD in the bank that they claimed to have. As a result, these stablecoin projects have no way to properly collateralize their crypto supplies. This could be a major issue if something happened to the market or to a specific stablecoin.
USDC meets this head-on by offering a public audit report right on the CENTRE website. Feel free to have a look.
Ethex is proud to announce the listing of USDC. We pride ourselves in only listing useful tokens, and USDC presents a great opportunity for crypto traders/investors to store their wealth and stay in a cryptocurrency. You can purchase USDC/ETH here.
Hope you enjoyed the article and learned something new. Feel free to leave a clap or 50. We always like hearing from the community so feel free to drop us a comment below or hit us up on the channels listed below. We also just released a Mobile Trading Wallet which you can check out on iOS and Android✌🏼
Blog — Twitter — Youtube — Telegram — Newsletter
