USD Coin (USDC) is a stablecoin pegged to the US dollar in a ratio of 1:1. Each unit of this cryptocurrency in circulation is backed by dollars, which are stored in reserve in the form of cash and short-term US bonds. The USD Coin cryptocurrency is a joint project of Circle (Circle Internet Financial) and the Coinbase cryptocurrency exchange. The development was also carried out by their joint organization Center Consortium.
USD Coin currency is a source of stabilicoin, fully supporting the dollar. Fiat is stable and plays an important role in ensuring the implementation of sub-invoicing and financial transactions based on smart contracts.
Technically, the USDC functions as follows:
- Clients transfer their funds to the system through the USD Coin issuer.
- The issuer launches commands on the network to verify the cryptocurrency and create tokens.
- The client performs operations with verified tokens around the world.
- In reverse transactions, the client requests permission from the issuer for the operation. After validation, USDC tokens are burned, and funds from the basic reserves go to the client's bank.
One feature of interest throughout, as well as user confidence, is that they can send $ 1 to receive $ 1 us coins, and vice versa, without problems. All work of issuing new USDC Cards is in accordance with banking regulations, US law. Some use cases specified in USDC. The creators of stablecoin say that instability can serve not only as a safe haven currency for traders, but also allows them to receive payments through digital means. USD Coin stablecoin is also designed to work with decentralized financing in the game. If you are an experienced user, you can use special cryptocurrency exchanges to buy cryptocurrency. It is worth remembering that exchanges have their own complexities and nuances, which can be difficult for inexperienced users. If you are just starting to get acquainted with cryptocurrency or do not like to buy currency on exchanges, it is better to use the services of cryptocurrency exchangers. USDC is an ERC-20 token created on the Ethereum blockchain. Due to this, most ETH wallets, such as My Ether Wallet are suitable for storing it.
To become an issuer of a digital asset, you must meet the following requirements: Have licenses from the necessary legal and financial organizations.
- Pass the Anti-Money Laundering check and comply with the Financial Action Task Force on Money Laundering standards.
- Create a 1:1 reserve with the issued tokens and provide monthly reports on its availability, approved by certified auditors.
- Support the mutual exchange of USDC with other issuers.
- Fulfill obligations to the company and follow the established rules.
The functioning of the USDC is provided with the help of a special application Center, which is responsible for ensuring the flexible interaction of crypto with fiat money through the use of the technology of smart contracts of the Ethereum crypto network. The main advantage of the USD Coin cryptocurrency over the dollar is its autonomy. Using this stablecoin, a person does not depend on the conditions imposed by financial institutions. At the same time, the transaction of a fiat currency through a bank can take several days. The USDC does not have such a problem: operations are carried out without delays. The commission in the network is also significantly less than with a bank transfer.
The main positive aspects of this crypt include:
- The development team is formed from experienced programmers, which is additionally supported by good financing of the project from major players in the cryptocurrency market. This text is from community cryptodefix. Most of the members of the USD Coin programming team have extensive experience in the cryptocurrency environment. This means that the coin has a chance of success due to the proper experience of its authors.
- Large companies and well-known figures of the cryptocurrency market are listed among the partners and investors of the crypto platform. One of the main achievements of the creators and managers of USDC is the formation of strong partnerships with some investors and companies that successfully operate in the crypto market.
- Early launch of the project on cryptocurrency exchanges. Most of the young projects are experiencing certain difficulties associated with getting into the list of supported assets of cryptocurrency exchanges. At the same time, the USDC managed to get into the listing of Coinbase and Poloniex a few weeks after the official launch of the crypto market. It should be noted that within the framework of the Poloniex exchange, this asset is traded without the need to pay a commission.
- The specifics of the work and technical basis of USD Coin determines the stability of the exchange rate quotes of this coin, which distinguishes it from other cryptocurrencies that differ in the volatility of their value.