$USDC

🧱 Basic Introduction

• Full Name: USD Coin

• Issuing Company: Centre Consortium, established by Circle and Coinbase

• Launch Time: 2018

• Pegged Object: 1 USDC = 1 USD (theoretically)

• Market Capitalization: Approximately 32 billion USD (as of mid-2025)

• Main Chains: Multi-chain deployment on Ethereum, Solana, Polygon, Base, Arbitrum, Avalanche, etc.

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🧠 How Does USDC Work?

USDC is classified as a “fiat-backed stablecoin,” which means:

Each USDC is backed by an equivalent amount of cash or short-term U.S. Treasury bonds as reserves.

This is similar to USDT, but the biggest difference is that USDC's reserves and auditing information are very transparent.

Circle publishes audited asset reports monthly, detailing the amounts of cash and Treasury bond reserves, verified by a reputable accounting firm.

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✅ Summary of Advantages

1️⃣ Regulatory Transparency, Compliance with Audits

Circle is a U.S. regulated fintech company that collaborates closely with banks and governments, and has publicly undergone regulatory scrutiny multiple times.

2️⃣ High Stability, Wide Institutional Adoption

Many DeFi protocols, NFT markets, exchanges, and even traditional financial institutions prefer to use USDC as a settlement unit.

3️⃣ Multi-chain Support, Convenient Transfers

Supported across public chains from Ethereum to Solana, Base, etc., transfers are quick, with low fees, and widely applicable across chains.

4️⃣ High U.S. Regulatory Friendliness

If the U.S. launches a digital dollar (CBDC) in the future, USDC is likely to be the bridge product closest to the official standard.

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⚠️ Risks and Challenges

❌ Fiat Custody Risk

Although supported by cash or U.S. bonds, these reserves are still held by specific banks. For example, the Silicon Valley Bank incident (SVB) in 2023 briefly caused USDC to lose its peg.

❌ Centralization Risk

The smart contracts and funds of USDC can be controlled by Circle; accounts can be frozen and funds can be reclaimed, which has raised considerable controversy in decentralized communities.

❌ High Correlation with Government Regulation

Although this is an advantage, it also means that if policies change, the use of USDC will be subject to strict restrictions or scrutiny.