More stablecoins are being launched every day with Coinbase and Circle recently working together to introduce the Digital Dollar (USDC). The two companies are optimistic that the new stablecoin will provide stiff competition to Tether (USDT), in this burgeoning market. Commodity-tied coins are considered more reliable than the other Cryptocurrencies in payments as they have a low risk of losing value due to volatility.
Another Stablecoin Hits The Market
Coinbase has approved Digital Dollar (USDC), one of the most recently launched USD-pegged virtual currency in a partnership with Circle. The customers of this brokerage giant are expected to be among the first to access this Cryptocurrency. On Tuesday, the exchange said that its customers will now be able to purchase, sell, and receive the new stable coin.
Unlike some stablecoins that fail to publicly declare the assets that back them, USDC is supported by dollars held in various firm-controlled bank accounts. The new stable coin is available to all Coinbase customers around the world except in New York. The exchange has confirmed that the coin is not listed on Coinbase Pro but has said it will be added in a few weeks.
Coinbase’s View On Stable Coins
Coinbase has come forward and said that stablecoins such as USDC could be used to create a more transparent financial system. Furthermore, such coins could also boost the adoption and use of decentralized applications (dApps). The company said that blockchain-based commodity-backed coins are easier to store locally, use in dApps, send, and program with than fiat currencies.
Although Cryptocurrencies are known for making it easy for people to pay for goods, especially overseas, there is always that fear of volatility, which may affect businesses’ revenue. Stablecoins such as USDC, however, can be used for business purposes without the fear of volatility. The availability of stablecoins can enhance the adoption of Cryptocurrencies as a payment method by businesses and e-commerce platforms.
Coinbase And Circle Role In USDC
Coinbase’s decision to support USDC is not the only area where the exchange is working with Circle. The two companies are also the founding members CENTRE Consortium. This group governs the creation of the dollar-pegged Cryptocurrency and will also play a similar role if the consortium may become involved in a similar project in the future.
Previous, only scanty information was available about the role of Coinbase in this project. However, it has been confirmed that the two companies have partnered in the development of the technology used on USDC. The coin has been structured on the Ethereum network.
The CEO and co-founder of Circle Jeremy Allaire had a few things to say about the new partnership, among them thanking Coinbase for acting as CENTRE cofounder. He added that one firm does not own USDC as most of the other coins in the market. Instead, Allaire saidthe coin is distributed according to clear rules.
Allaire also said work on CENTRE and the new stable coin began last year. He added that they wanted to work with an industry leader to set new standards for financial contracts. He said they are happy working with Coinbase and they will not mind working with other partners in the near future.