USD Coin (USDC) – What it is, definition and concept

USD Coin (USDC) is a cryptocurrency linked to the United States dollar (USD) that can be managed on various platforms such as Etherum, Stellar or Solana.

In this case, its essential difference is that it is linked to fiat money, therefore, we are facing a stablecoin. In addition, they can also do it to other cryptocurrencies or precious metals, among other reference values.

Origin of USD Coin (USDC)

The first news about this cryptocurrency was in 2018, announcing it by Circle Internet Financial. In addition, others such as Center and Coinbase participated in its creation. These companies were responsible for its introduction into Ethereum.

In September of that same year it was launched on the market. On the other hand, Circle reported in June 2021 that there were some 24.1 million USDC circulating. Good news was that in the same year VISA allowed it to be used to carry out transactions on its network.

Characteristics of USD Coin (USDC)

Let’s take a look at some of the features of this dollar-based cryptocurrency (USD).

  • First of all, we are facing a stablecoin. This means that it is based on assets such as currencies or precious metals, as we have already mentioned.
  • Being a digital equivalent of the dollar (USD), it allows you to make transfers in any geographical area in a very short time.
  • It is a cryptocurrency that has become an alternative to others such as TrueUSD (TUSD).
  • By allowing tokenize USD dollars, it facilitates the use of these on the Internet and on different Blockchains.
  • In addition, it is one more alternative to make payments.
  • Finally, they can always be exchanged back for dollars (USD).
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Tokenization process

Let’s see, to finish, the USD Coin (USDC) tokenization process.

  1. First, the user will transfer dollars (USD) to a bank account of the issuer of the cryptocurrency.
  2. Second, through a smart contract (Smart Contract), the necessary amount of this digital currency is created.
  3. Third, the USD Coin (USDC) is sent to the user and the dollars are held in a specially established reserve.

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