In this intriguing photo illustration, the Coinbase cryptocurrency exchange website captivates the screen of a computer in Paris, France. The image portrays the significance and influence of Coinbase in the world of cryptocurrencies. The company’s reputation is further solidified by its recent decision to acquire a stake in Circle, the issuer of the USDC stablecoin. This move signifies a closer relationship between these two crypto heavyweights, as they recognize the value of collaboration in the ever-evolving digital landscape.
Coinbase and Circle have also announced the closure of the Centre Consortium, a private governance organization for USDC. This decision stems from their confidence in the regulatory clarity surrounding stablecoins. Coinbase, in a thought-provoking blogpost, expresses its belief in the fundamental importance of stablecoins to the broader crypto economy. By acquiring an equity stake in Circle, Coinbase aims to enhance its strategic and economic alignment with the future of the financial system, specifically focusing on the success of USDC.
In a tumultuous period in March, USDC experienced a significant decline below its peg due to the collapse of Silicon Valley Bank, a major lender to the tech industry. Circle, being a customer of SVB, held a substantial amount of its cash reserves with the now-defunct bank. However, U.S. regulators intervened, closing SVB down and taking control of its deposits, leading to the restoration of customers’ access to their funds. Consequently, USDC regained its $1 peg, highlighting the resilience and stability of the stablecoin.
Circle, a prominent player in the $124.1 billion stablecoin market, originally launched its own U.S. dollar version of a stablecoin in 2018. Despite its decision to postpone plans of going public via a special purpose acquisition company, Circle remains integral to the stablecoin market.
Currently, USDC holds about 21% of the entire stablecoin market, with a total value of over $26 billion in circulation. Tether, the largest stablecoin, dominates the market with a valuation of $82.8 billion and a market share of nearly 67%. As stablecoins gain more attention from regulators, following the collapse of the terraUSD stablecoin, Circle aims to navigate this evolving landscape effectively.
To propel the momentum of USDC, Circle has brought Coinbase onboard as an investor and decided to launch USDC on six new blockchains between September and October. These blockchains serve as the decentralized foundations for digital currencies, allowing for seamless transactions without reliance on traditional banking systems. Although Circle has not disclosed the specific blockchains, this expansion will bring the total number of blockchains supporting USDC to 15, thereby bolstering its availability and accessibility to developers worldwide.
Amidst the changing tides of the digital currency landscape, Coinbase’s investment in Circle showcases the power of collaboration and innovation. The future of stablecoins and their impact on the financial system continues to evolve, and these two crypto heavyweights are at the forefront of shaping this exciting future. Through strategic partnerships and advancements in technology, Coinbase and Circle are positioning themselves as leaders in the ever-expanding world of cryptocurrencies.
Denial of responsibility! VigourTimes is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
