$USDC

Introduction

USDC is a stablecoin, a particular form of crypto designed to maintain a stable value by being backed by a pool of underlying assets.

In the case of USDC, this pool is made up of US dollars (USD).

Thus, 1 USDC is always supposed to be worth 1 USD.

Created by a consortium of technology companies, the USDC stablecoin is intended to offer a digital alternative to the traditional US dollar, while retaining its monetary stability.

How does Usdc work?

USDC is a stablecoin based on blockchain technology and designed to maintain a stable value by being backed by a reserve of US dollars.

Its operation relies on a carefully orchestrated process to guarantee its stability and parity with the US dollar.

First of all, it’s important to note that the USDC was initially built on the Ethereum blockchain, meaning that it uses Ethereum’s decentralized technology for its transactions and records.

As an ERC-20 token, it is interoperable with a multitude of ERC-20 compatible wallets and platforms, making it much easier for users to manage and exchange.

However, with a view to further development, Circle has made the USDC available natively on eleven different blockchains (Ethereum, Algorand (price Algorand), Arbitrum, Avalanche, Flow, Hedera, Solana, Stellar, TRON, OP Mainnet, and Base).

The creation of new USDCs begins with users depositing US dollars with Circle, the entity that manages the USDC.

These dollars are then placed with verified partners, often financial institutions.

Circle can then issue an equivalent amount of USDC on the chosen blockchain.

This operation is crucial, as it guarantees that every USDC in circulation is backed by a real US dollar.

Thus, from the moment it is created, the USDC maintains parity with the dollar.

The USDC can then be used for transactions, payments, or even as a means of storing value.

It can be traded on exchange platforms, used for online payments or transferred between users via crypto wallets.

To facilitate interoperability between different blockchains, Circle has deployed the Cross-Chain Transfer Protocol (CCTP)