### **What is USDC?**

**USDC (USD Coin)** is a **stablecoin** pegged 1:1 to the US dollar, meaning each USDC is backed by an equivalent amount of cash and short-term US Treasury bonds. It was launched in 2018 through a collaboration between **Circle** and **Coinbase** under the Centre Consortium (though Circle now fully manages USDC).

### **Key Features of USDC**

1. **Stability** – Unlike volatile cryptocurrencies like Bitcoin, USDC maintains a stable value of $1.

2. **Transparency** – Reserves are regularly audited by top accounting firms to ensure full backing.

3. **Fast & Low-Cost Transactions** – Enables quick cross-border payments with minimal fees compared to traditional banking.

4. **Multi-Chain Availability** – USDC operates on **Ethereum, Solana, Avalanche, Algorand, Stellar, and other blockchains**.

5. **Regulated & Compliant** – Issued by licensed financial institutions, adhering to US money transmission laws.

### **How Does USDC Work?**

- **Minting**: Users deposit USD into a bank account, and Circle issues an equivalent amount of USDC.

- **Redemption**: Users can exchange USDC back to USD at any time.

- **Usage**: USDC is widely used in **DeFi (Decentralized Finance), trading, remittances, and as a dollar-backed digital asset**.

### **USDC vs. Other Stablecoins**

- **USDT (Tether)**: Less transparent, with past controversies over reserves.

- **DAI**: A decentralized stablecoin backed by crypto collateral, not fiat.

- **USDP & TUSD**: Other fiat-backed stablecoins but with smaller market shares.

### **Why Use USDC?**

✅ **Secure & Reliable** – Fully audited reserves.

✅ **Widely Accepted** – Used across exchanges (Coinbase, Binance), DeFi platforms (Aave, Uniswap), and payment systems.

✅ **Ethereum & EVM-Compatible** – Works seamlessly with smart contracts.

### **Recent Developments**

- **Expansion to New Blockchains** (e.g., Polygon, Arbitrum).

- **Integration in CBDC (Central Bank Digital Currency) experiments**.

- **Growing adoption in institutional finance**.