USDC (USDC)

USDC is a stablecoin, a particular form of crypto designed to maintain a stable value by being backed by a pool of underlying assets.
In the case of USDC, this pool is made up of US dollars (USD).
Thus, 1 USDC is always supposed to be worth 1 USD.
Created by a consortium of technology companies, the USDC stablecoin is intended to offer a digital alternative to the traditional US dollar, while retaining its monetary stability.

USDC was created by Centre, a joint venture between two cryptosphere giants: Circle and Coinbase.

1. Circle: Founded in 2013 by Jeremy Allaire and Sean Neville, Circle is a fintech company that has positioned itself as a crypto payment and exchange platform.
   The company has played a leading role in the development and adoption of blockchain technology on a global scale.
2. Coinbase: American crypto exchange platform founded in 2012 by Brian Armstrong and Fred Ehrsam.
   Since its inception, Coinbase has been a major player in the popularization of crypto across the Atlantic and has helped broaden its adoption worldwide.

The partnership between these two companies has been essential in the creation and promotion of USDC.

USDC is a stablecoin based on blockchain technology and designed to maintain a stable value by being backed by a reserve of US dollars.
Its operation relies on a carefully orchestrated process to guarantee its stability and parity with the US dollar.
First of all, it’s important to note that the USDC was initially built on the Ethereum blockchain, meaning that it uses Ethereum’s decentralized technology for its transactions and records.
As an ERC-20 token, it is interoperable with a multitude of ERC-20 compatible wallets and platforms, making it much easier for users to manage and exchange.
However, with a view to further development, Circle has made the USDC available natively on eleven different blockchains (Ethereum, Algorand (price Algorand), Arbitrum, Avalanche, Flow, Hedera, Solana, Stellar, TRON, OP Mainnet, and Base).
The creation of new USDCs begins with users depositing US dollars with Circle, the entity that manages the USDC.
These dollars are then placed with verified partners, often financial institutions.
Circle can then issue an equivalent amount of USDC on the chosen blockchain.
This operation is crucial, as it guarantees that every USDC in circulation is backed by a real US dollar.
Thus, from the moment it is created, the USDC maintains parity with the dollar.
The USDC can then be used for transactions, payments, or even as a means of storing value.
It can be traded on exchange platforms, used for online payments or transferred between users via crypto wallets.
To facilitate interoperability between different blockchains, Circle has deployed the Cross-Chain Transfer Protocol (CCTP).
It enables USDCs to be transferred natively from one blockchain to another via a burn/mint mechanism.
In concrete terms, a user who owns USDCs on Ethereum and wishes to transfer them to the Avalanche blockchain will interact with the CCTP as follows:

1. The user sends the CCTP his USDC on Ethereum
2. CCTP destroys USDC on Ethereum
3. CCTP creates new USDCs on Avalanche
4. CCTP sends user USDC on Avalanche

This tool makes it possible to move from one network to another in complete security, without taking the risk of using a bridge, which is less secure and therefore more susceptible to hacking.
Historically, bridges have been prime targets for hackers.
Indeed, the very design of a bridge requires it to store a significant quantity of cryptos for its operational functioning.
The CCTP provides an answer to this problem and brings the interoperability that USDC stablecoin needs to continue developing.

USDC (USD Coin) tokens are stablecoins backed by the US dollar, designed to maintain a 1:1 parity with the dollar.
They are primarily used to facilitate transactions in the cryptocurrency ecosystem by offering a stable, less volatile alternative to other cryptocurrencies such as Bitcoin or Ethereum.
USDCs are widely used in decentralized finance (DeFi) for operations such as trading, lending and borrowing, as well as for making fast and inexpensive international payments.
What’s more, USDCs enable users to retain the value of their dollar-denominated assets while remaining within the crypto universe.

In order to generate income from USDC reserves, Circle invests part of the US dollars collected in short-dated US Treasury bills.
At the time of writing, USDC reserves are as follows:

• 12% in dollars in accounts at various banking institutions (Bank of New York Mellon, etc.)
• 88% in U.S. Treasury bills with maturities of three months or less

By way of comparison,USDT reserves include only 0.12% of dollars in bank accounts.
The rest is made up of 88% US Treasury bills and 11% other media (gold, Bitcoin, corporate bonds, etc.).
The two components of USDC reserves make it one of the most liquid stablecoins on the market.
Cash in bank accounts is by definition the most liquid, and US Treasury bills all have maturities of ninety days or less to guarantee rapid availability of funds.

In 2024, Circle, the USDC issuer, plans to boost adoption of its stablecoin by expanding its partnerships with financial institutions and technology companies.
The company also aims to integrate USDC into more blockchain networks to improve interoperability and reduce transaction fees.
Circle is working on the development of innovative payment solutions based on USDC to drive the adoption of digital payments on a global scale.

1. Go to your Coinhouse application and log in to your personal space or create your account.
2. Go to the buy/sell section.
3. Select the amount you wish to invest, and the currency of your choice (in this case USDC).
4. Once your transaction has been validated, you ‘ll find your USDCs in your portfolio.

USDC is one of the most promising stablecoins today.
It is the 2nd largest stablecoin on the market, with over $26 billion in capitalization, and is highly transparent about its reserves.
What’s more, its reserves are among the most liquid on the market, increasing the level of confidence that investors can have.
On the technological front, Circle is constantly directing its resources towards the development of innovative solutions to facilitate the adoption of stablecoins as a means of payment.
The Cross Chain Transfer Protocol (CCTP) is a perfect example.
Circle also invests in partnerships to support the adoption of USDC.
Although still a long way behind the USDT in terms of capitalization, the USDC presents solid arguments that make it the solution of choice in the centralized stablecoin segment.