USDC (USD Coin) maintains stability through a 1:1 peg to the U.S. dollar, ensuring each token is backed by $1 in reserve assets. Issued by Circle and Coinbase, these reserves include cash and short-term U.S. Treasury securities, held in regulated financial institutions. Monthly audits by independent firms verify the reserves match circulating USDC. This transparency and dollar backing minimize volatility, making USDC a reliable stablecoin for trading, payments, and hedging in crypto markets. However, stability depends on reserve management and regulatory compliance, with risks like asset mismanagement or legal changes potentially affecting the peg.$USDC