Stellar Becomes Third Official Blockchain for USDC Stablecoin
Circle’s USD Coin (USDC), a stablecoin pegged to the US dollar, today found a new home on the open-source decentralized protocol Stellar, which becomes its third major blockchain.
The move comes a few months after the stablecoin was launched on the Algorand (ALGO) blockchain, which reduced its reliance on Ethereum network that has offered the support for the native ERC-20 coin since inception.
Stellar is an open-source payment technology that shares several similarities with Ripple. Both coins shared the same protocol initially and were also co-founded by the same person, Jed McCaleb. Much like Ripple, Stellar aims to connect financial institutions and reduce the cost and time required for cross-border transfers.
“Combining our strengths – USDC as one of the world’s leading compliant and regulated digital dollar stablecoins and Stellar as a mature network with an unparalleled ability to connect global financial infrastructure – we are positioned to offer USDC and Stellar users a new level of opportunity,” said Denelle Dixon, CEO of Stellar Development Foundation.
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Acting as a sort of safe haven where crypto traders can park their assets in volatile markets, USDC is an Ethereum-based ERC-20 coin, which makes it easy for wallets, exchanges, and other smart contracts to interact with the token.
USDC currently ranks as the second-largest stablecoin by market cap, and the 13th-biggest crypto asset with a capitalization of nearly $2.7 billion. The coin was developed as a joint venture comprising US crypto exchange Coinbase and payments firm Circle.
However, USDC showed a muted reaction to the news, having dropped 0.01 percent on the day, according to CoinMarketCap.
This expanding support for USDC on new blockchains comes as confidence into the coin has rapidly grown after it onboarded a major accounting firm to audit its reserves. The move was important due to nagging questions around Tether’s major stablecoin, which conceded its dominance to other alternatives, including Circle’s coin, Paxos Standard, and the Gemini Dollar.
Circle has recently opened the doors of its stablecoin to businesses with the launch of a dedicated account that provides a toolbox of APIs to allow developers to build on top of USDC. The move expands the reach of the offering that is primarily focused on retail trading and investing to appeal for B2B partnerships.