The 13th largest kryptomone is now a stablecoin, and is called USD Coin (USDC). Find out here how it came to be.
Stablecoins continue to gain ground in the ecosystem, while accelerating the adoption of cryptomonies in general. Today we are talking about USD Coin, better known for its USDC label, which has recently been able to climb to 13th place in the crypto market.
This climb is thanks to a growth of more than 100% of its capitalization in a matter of 2 months. It managed to grow from $1.000 billion in early August to $2.541 billion today.
About USD Coin (USDC)
USDC is a stablecoin anchored to the price of the US dollar in a 1 to 1 ratio. For each unit of USDC there is 1 dollar in reserve, combined with cash reserves and short-term US Treasury bonds.
Behind this stable currency is the Centre consortium, which claims that the issue is made by regulated financial institutions.
It is designed to fulfil the role of digital money in the digital age we are living in, where transactions using cash are becoming less common.
Since its launch in 2018 it has been gaining ground and case studies, going beyond a simple tool for those seeking refuge from the volatility of cryptomoney.
The USDC issuing team indicates that this stablecoin allows businesses to receive digital payments, as well as revolutionising different sectors, mainly finance and decentralised games.
Boom DeFi drives USD coin
Without a doubt the main cause of the exponential growth of the increase in USDC capitalization, is the massive wave of liquidity injection in DeFi protocols.
One of those DeFi projects that most encouraged the use of USD Coin was Curve Finance, with the launch of its CRV governance token on August 14.
But it is not only Curve that has contributed to the parabolic growth of this stablecoin.
According to Flipside Bitcoin Profit, users of decentralised finance are using USDC to interact with different protocols.
These users are looking to obtain returns through loans on platforms such as Compound and Aave. In other cases they are looking to generate profits by providing liquidity in pools such as those provided by Uniswap and Curve.
Even Tether maintains a solid hierarchy between stable currencies, followed by DAI. However, USD coin has been steadily gaining ground and has become a benchmark asset in the DeFi.
A recent update of USDC allows users to pay transaction fees at the same stablecoin. This improves the experience by bypassing the Ethereum gas system and decreasing network congestion.
Everything seems to point to the fact that this stablecoin will continue to gain traction in and out of the DeFi. There is no reason to forecast a negative future, at least not in the short and medium term.