Stable Coin “Older Two” USDC Multi-chain Punch

USDC is gaining more favorable conditions as the US regulatory attitude is opening up.

Stablecoin USDC (USD Coin) is planning to further expand its distribution sites to 10 blockchains such as Tron, Avalanche, and Celo to accelerate its market share.

Since its birth in 2018, USDC has accelerated to catch up with USDT, the leader in the stablecoin space, thanks to its compliance and transparency. currently, USDC has 25.218 billion in circulation, ranking second among all stablecoins, still far behind USDT, which has 63.046 billion in circulation.

While the latter still dominates the stablecoin market, USDC is gaining more favorable conditions as regulatory attitudes open up in the U.S. On June 29, Federal Reserve Vice Chairman of Regulation Randal K. Quarles saw stablecoins as an innovation that could be deployed faster and with fewer drawbacks than CBDCs (central bank digital currencies) in a speech.

Soon after, Compound Labs announced a new company to support new banks and institutions to exchange USD for USDC and earn no less than 4% APR in Compound; Coinbase also went live with a USDC savings product to support retail investors to deposit USDC to earn interest.

Compared to USDT, whose reserves are not very transparent, USDC has become the party that is “near the water” with its compliance development. As it is issued and circulated on more chains, this ‘second’ in the stablecoin space is expected to further narrow the gap with the leader.

USDC plans to add 10 new blockchain issuance sites
USDC, the stablecoin with the second largest market share, is plotting a voluminous offensive war to make further inroads into the number one throne held by USDT.

On June 30, according to a draft announcement from the USDC management center, USDC is expected to be issued on 10 blockchain networks – Avalanche, Celo, Flow, Hedera, Kava, Nervos, Polkadot, Stacks, Tezos and Tron (Wavefield) – in the coming months.

This will be a massive “money printing” program, not only in terms of the upcoming expansion of USDC’s issuance, but also in terms of the exponential increase of the stablecoin’s circulation.

The Wavefield blockchain also confirmed on its official Weibo account that Centre will soon launch a Wavefield version of USDC, which has quickly become the first choice for users to transfer money due to its low transaction fees, and the blockchain’s daily trading volume has increased significantly due to the presence of USDT. Now, the USDC issuance on Wavefield is seen by that blockchain community as another major ecological development.

The brightest label on USDC, a fast-growing stablecoin, is compliance. officially issued in October 2018 by Centre Alliance, a joint venture between Coinbase and Circle, USDC has a third-party auditing firm that regularly issues credible reports to prove that it has a full amount of dollars as reserves, compared to USDT, which has less transparent dollar reserves.

Since its issuance on Ether in 2018, the use scenario of USDC has gradually increased, a typical example is that Maker, a well-known lending protocol on the Ether chain, has accepted USDC as collateral, supporting users to pledge USDC to lend assets such as DAI. in the second half of 2020, USDC was extended to Algorand, Stellar, Solana and other blocks issued on the chain, extending the circulation boundary.

According to Tokenview on June 30, USDC currently has 25.218 billion units in circulation, ranking second among all stablecoins. The top ranked coin is USDT, which was created in 2014, with 63.046 billion coins in circulation, firmly occupying the leading position of stablecoins.

Stable Coin "Older Two" USDC Multi-chain Punch

USDC ranks second in the stablecoin market cap chart

Although USDT still dominates the stablecoin market, the data shows that USDC is growing rapidly.

In February, crypto asset data analytics firm Coin Metrics released data showing that USDC’s market cap share of the stablecoin market was below 75% for the first time. In the same period, USDC’s market cap share has grown to an all-time high of 15%. The two are growing against each other, reflecting the rapid rise of USDC.

Moreover, Tokenview data shows that the total amount of USDT on-chain transactions on June 29 was 11.771 billion USDT, while the total amount of USDC on-chain transactions on that day was 11.82 billion USDC, and the trading volume levels of the two stable coins have been very close.

From the recent actions, it is clear that USDC is not satisfied with this, and it is trying to expand its distribution to challenge USDT’s leading position. If USDC completes its expansion plan, it will be circulating on as many as 14 blockchains. USDC’s multi-chain expansion could be a turning point for it to compete with USDT.

Fed Gives Stablecoin ‘Good Reviews’ an Environmental Advantage
After years of development in the crypto asset market, investors have long been accustomed to using US dollar stablecoins as the unit of denomination for crypto asset exchange. As the earliest issued stablecoin with the largest user base, USDT is widely adopted by major exchanges, and most trading pairs are denominated in USDT.

In terms of users’ trading habits, few other stablecoins can compete with USDT. However, USDC is more compliant and transparent, which makes it easier to be accepted by regulation in the long run. In particular, the current U.S. regulation has shown an open attitude towards stablecoins, so USDT, which is closer to the regulation, may become the party that is “close to the water and first to the moon”.

In the early morning of June 29, Randal K. Quarles, vice chairman of regulation at the Federal Reserve, saw dollar stabilized coins as a financial innovation in a speech. We don’t need to be afraid of stablecoins,” he said, adding that the Federal Reserve has historically supported responsible private sector innovation and that dollar-stable coins could bring support to the dollar in the global economy by encouraging its use through faster and cheaper cross-border payments. And it could be deployed faster and with fewer drawbacks than a CBDC (central bank digital currency).

Randal K. Quarles took the position that those who fear that stablecoins challenge monetary sovereignty are baffled. He doesn’t think stablecoins are a threat, just that they need to be regulated in the way they are built and managed. The Fed official even argued that improving the existing payment system and combining it with the cross-border efficiency of stablecoins would likely make issuing CBDCs redundant.

On the same day the speech was announced, Compound Labs announced the formation of a new company called Compound Treasury, which will reportedly work with Fireblocks and Circle to allow new banks and fintech companies to convert U.S. dollars into USDCs. these USDC tokens will be deposited into Compound at a guaranteed interest rate of 4%. in.

From a broader perspective, Compound Treasury creates a connection where dollar holders don’t need to keep their money in the bank, but instead exchange it for USDCs to capture an interest rate of no less than 4% in the Compound agreement. It further adds to the stablecoin scenario by giving it an interest-bearing function in addition to acting as a purchasing power for crypto assets.

Immediately afterwards, on June 30, Coinbase similarly announced on its official website the launch of its USDC savings product, which allows retail investors to deposit USDC to receive an annualized return of 4%. coinbase says that USDC is guaranteed by it.

After U.S. regulation affirms the innovative value of stablecoins, USDC is likely to be noticed by capital institutions as a guaranteed interest-bearing asset.

At this point, USDT, which is distanced from regulation and has less than transparent reserves, cannot help but fall into a disadvantageous competitive condition. USDT, which has occupied the leading throne for a long time, is facing an increasingly rapid catch-up from the later.

Posted by:CoinYuppie,Reprinted with attribution to:
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