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Introducing USDC digital currency

Introducing USDC digital currency

USDC is a stablecoin based on Ethereum. A type of digital asset whose value is 1:1 in US dollars. This means that holders of this digital currency can redeem 1 coin for 1 dollar at any time. Each USDC is backed by a dollar or an asset of equivalent value held in the accounts of US regulated financial institutions. In this article, we will talk about USDC. Stay with us until the end of the article.
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USDC is a stablecoin based on Ethereum. A type of digital asset whose value is 1:1 in US dollars. This means that holders of this digital currency can redeem 1 coin for 1 dollar at any time. Each USDC is backed by a dollar or an asset of equivalent value held in the accounts of US regulated financial institutions. In this article, we will talk about USDC. Stay with us until the end of the article.

USD Coin (USDC)

USDC, also known as USDC among cryptocurrencies, is a stablecoin developed by Centre, a non-profit organization backed by major cryptocurrency exchange Coinbase and fintech firm Circle. USD Coin has a set value of USD 1 per coin and each USD Coin is backed by USD in a separate bank account. This digital currency entered the market for the first time in 2018. USDCoin is the most suitable alternative to cryptocurrencies such as Tether.

  How does USDCoin work?

The USD coin works to tokenize the US dollar on a blockchain. The service is a collaboration between cryptocurrency exchange Coinbase and financial services provider Circle. Their shared vision of bringing the US dollar to a blockchain means that traders can maintain the dollar value of their portfolio during periods of high volatility without having to exchange their crypto holdings for a fiat currency. It also allows tokenized dollars to be sent through the blockchain network: something much faster and cheaper than sending dollars through the old banking system.

USD coin can be generated by just sending USD to the crypto issuer's bank account and interacting with the smart contract on the blockchain that one wants to use. To redeem USDC into USD, the process is reversed. That is, the USDC user sends his request to buy USDC coins to the issuer. In the next step, the issuer sends the request to the smart contract, as a result, the currencies are converted into dollars and the equivalent amount is withdrawn from the financial circulation, and finally the requested dollars will be sent to the user's bank account through the issuer. Of course, the final amount is deposited after deducting the fee.

USDCoin is found on several public blockchains including Ethereum, Solana, Elgorand, Tron, Hedra, and Stellar. This token is interoperable with all the features of the public blockchains on which it resides, including decentralized finance (DeFi) and smart contracts.

Key events and management

The USD coin was developed by Center Consortium, a company that represents a partnership between Circle and Coinbase. The center develops the technology and framework governing the USD coin, and Circle and Coinbase issue the coin.

Center was founded in 2017 by Wall Street veteran David Pott, who was still CEO until November 2021. According to Crunchbase, the company raised $20 million in a seed round in December 2017 and another $20 million in a November 2018 round led by Digital Finance Group. As mentioned, USD Coin was created for the first time in collaboration with Circle and Coinbase. All the framework and technology of this coin has been developed by this center. Founded in 2013, Circle is an official money transmitter managed by Jeremy Allaire and Sean Neville. Official money transmitters are service businesses in the United States that are active in the field of money services and must comply with federal laws and regulations.

The USD coin is available in the Layer 2 scaling product for the Ethereum network. As the project is open to collaboration, the Center and USDC exporters may explore other Tier 2 opportunities in the future.

Advantages of USDCoin digital currency

One of the advantages of USDCoin can be seen in the main purpose of its creation. USDCoin currency was created in order to create a US dollar encryption service and ease the use of coins on the Internet. Another advantage of this coin is the easy conversion of this currency to dollars at any time and place. On the other hand, guaranteeing the issuance and redemption of USD tokens is the responsibility of ERC-20 smart contracts.