What is USD Coin (USDC)?

USDC, or USD Coin, is the second-biggest stablecoin on the market after Tether or USDT. The value of USDC is pegged to the value of the American dollar, which creates certain advantages on the market. However, USD Coin is still a lot less popular than Tether (USDT).

USDC was created in 2018 as a USD-backed stablecoin. What it means is that it’s supposed to be 1:1 in value to the American dollar. It’s been consistent in this throughout its history. USDC is also more transparent and more likely to follow regulation compared to its big brother, USDT.

What is USDC?

USDC is a stablecoin pegged to the value of the American dollar. It was introduced in 2018 to the Ethereum blockchain. Tether, an earlier stablecoin, was introduced in 2014 to the Bitcoin blockchain (although it was also released to Ethereum later).

So, it was originally USDT but for Ethereum, which basically means a smart contracts stablecoin. Now, it’s more of a reliable alternative to USDT in case you are unable or unwilling to use USDT. There are also several intrinsic differences, but they are mostly superficial. 

USDC is also available on other networks, including several Ethereum-compatible chains and separate blockchains.

How Does USDC Work?

USDC is a fiat-collateralized cryptocurrency, which means that at any given moment, there are heaps of fiat money supporting the value of this coin. For each 1 USDC, there is a 1 USD. That’s mainly what supports the value of this stablecoin. It’s been very effective, and USDC never really went below $0.99.

This stability has a great deal of utility for the crypto market. Unlike regular cryptocurrencies, which are highly volatile and cherished for their insane potential for profit-making, stablecoins like USDC are more about storing value and preserving your savings while also using the same advantages as Bitcoin, Ethereum, and other coins.

It uses the same infrastructure, has the same capabilities, and has many of the same characteristics as ETH. It was created on the same blockchain, and USDC has long been a staple stablecoin here – in fact, the second-biggest cryptocurrency on this network ever. In every ETH-based online store, you can either pay in ETH or USDC.

USDC vs. USDT

There isn’t anything particularly different about USDC compared to USDT. The big distinction is popularity. USDT exceeds it by market capitalization and trading volume, and the gap is huge. So, in terms of availability, liquidity, and sheer numbers USDT wins handily. There are other factors to consider, however.

Even though USDT is available on Ethereum, it’s USDC that takes the cake here. It’s much more popular on the ETH blockchain, partly because of its long history with this network (which also means that a lot of early established projects support it) and partly because USDC is just more refined on Ethereum.

USDC, in particular, is the established go-to stablecoin when it comes to the use of smart contracts. A lot of the top dApps and DeFi solutions utilize USDC specifically because of its relationship to Ethereum.

Transparency and Security

A less prominent advantage of the USD Coin is its increased transparency. The company behind this stablecoin is much more open with its user base. They reveal a lot more of their insider information, post updates with great frequency and openness, and generally have a much more outwardly attitude.

It makes USDC slightly more trustworthy, which is a big deal with cryptocurrencies. Additionally, it’s perceived as more secure because they are posting updates to their security mechanisms in detail. In the end, it doesn’t matter, but if you value transparency, then USDC is a good choice.

USDC on CoinDepo

The CoinDepo platform supports USD Coin (USDC) as one of the main stablecoins. With CoinDepo, you can safely store your USDC in Compound Interest Accounts and earn from 18% to 24% per annum + compound interest, depending on the type of interest account you choose. Today, without exaggeration, this is the best offer on the market.

You can also borrow other major cryptocurrencies from CoinDepo against your USDC portfolio without opening a collateral account, which is a unique service that has no analogs in the world of digital assets.