Last updated on July 11th, 2023 at 11:15 pm
Telling some centralized or traditional finance enthusiasts to embrace cryptocurrencies can be likened to advising them to bear the burdens of Hercules on their shoulders. Many tend to look at some of the issues plaguing crypto, and volatility is a major one. This year, 2021, has gone to show us the two sides of the coin when volatility is concerned. In the first quarter and early second quarter of 2021, the value of many cryptos skyrocketed, with BTC almost getting to the $65,000 mark. Many altcoins were able to shatter their all-time high values of the previous year during this period. One would have expected that the ride would have retained its momentum, but that is not the case at the time of writing this. The value of many cryptos plummeted at the pace that it had previously risen. Volatility is a big concern, and it is something that stablecoins like USDC- US Dollar Coin- are trying to solve. As a stablecoin pegged to the dollar, 1 USDC is equivalent to 1 USD.
USDC: An Introduction
As a fiat-collateralized stablecoin, USDC has an equivalent value with the dollar, which offers the stability that many crave. Stablecoins are touted to be the bridge that will encourage more traditional finance enthusiasts to give the crypto world a chance.
When USDC was initially released to the market, it was built solely on the Ethereum blockchain, but it is now available on both Solana and Algorand.
USDC’s Origin Story
USDC is not the only stablecoin in existence. BUSD is a stablecoin created by Binance, while USDT is a stablecoin with links to Tether. USDC, on the other hand, was created by both Circle and Coinbase. Circle is a word-class crypto finance firm that is linked to top-notch financial institutions in the US.
In 2018, USDC was launched after it had gotten the necessary backing via venture capital funding. According to Coinmarketcap.com, as at the time of writing this, USDC sits pretty at the seventh position of cryptocurrencies with the largest market cap.
Why has more interest been shown to USDC?
USDC seems to have gotten intense action daily because of the controversy surrounding its competitor, USDT. With issues raised by some economists and government officials on USDT, many have been looking for alternative stablecoins that can act as a hedge against the volatility experienced in the crypto world.
The investigation that was launched into the affairs of USDT has shone the spotlight on other stablecoins in existence, and USDC is one of them. Apart from the aforementioned, there are other reasons USDC seems to be getting more attention daily.
To start with, USDC is highly regulated. Its parent company is registered in the US, meaning that it has to abide by strict financial regulations. USDC undergoes intense audits regularly, and the audits are done by one of the biggest accounting firms, Grant Thornton.
In Conclusion…
US Dollar Coin seems to be riding the wave of success by plugging the loopholes that have been noticed in its contender, USDT. For now, USDC seems to be on the right side of the law.
