USD Coin Guide: All About The Stablecoin Pegged To The US Dollar

If you are reading our latest cryptocurrencies news, there is a good chance you have heard about the term “stablecoins” which basically refers to cryptocurrencies that are “pegged” to the value of one US dollar. This USD Coin guide is dedicated to USDC as one of these stablecoins, which launched in 2018 in collaboration between Circle and Coinbase.

As a relatively fresh stablecoin, USDC is an alternative to other USD backed cryptocurrencies such as Tether (USDT) or TrueUSD (TUSD). In a nutshell, this coin is a service to tokenize US dollars and facilitate their use over the Internet and public blockchains. Besides, the USDC tokens can be changed back to USD at any time. The execution and redeeming of this tokens is completely ensured with an ERC-20 smart contract.

While stablecoins are a big part of the altcoin news now, the good thing is that they bring US dollars on the blockchain and allow people to move them anywhere in the world within minutes. The USD Coin guide also shows that USDC, just like other stablecoins, opens up plenty of new opportunities for trading, lending, risk-hedging and more.

Speaking of, the team behind USDC is the Centre consortium, a partnership between Circle and Coinbase. The technology as well as governing framework are developed by Centre, while Circle and Coinbase are the first commercial issuers of USDC.

Founded in 2013, Circle is an official money transmitter which makes the company an open financial book. Consequently, all of the USDC tokens are regulated, transparent and verifiable. Needless to mention, Circle is known as the crypto startup backed by Goldman Sachs.

As you can imagine from seeing this USD Coin guide, tokenizing USD into USDC is a three-step process in which:

1. A user sends USD to the token issuer’s bank account
2. The issuer uses USDC smart contract to create an equivalent amount of USDC
3. The newly minted USDC stablecoins are delivered to the user, while the US dollars he sent are held in reserve

Redeeming USDC for USD is as easy as minting the token, but the process is reserved. All USDC issuers are required to report their holdings which are then published by Grant Thornton LLP.

We hope this brief USD Coin guide helped you understand the basics behind one of the most impressive stablecoins out there!