What is USD Coin, is USD coin safe?

  • What is USD Coin, is USD coin safe?

    Since the pandemic, the use of stablecoin has increased sharply, after USD Tether there is also USD coin which is currently crawling up to thirteenth place on the Coinmarketcap rating site.

    What is meant by stablecoin are crypto tokens whose value is equal to $ 1. The USD coin currently has a market capitalization of $ 2,772,946,549 at the time press and a circulating supply of 2,771,257,648 USDC.

    USD Coin Explained

    USDC is a coin that is a stablecoin launched by Coinbase. With USD Coin, you can transfer U.S. Dollars to other users anywhere in the world in just minutes, cheaply, and safe. Tokens bring stability to crypto, as well as open up possibilities for trading, loans, and so on.

    USDC was developed by the consortium of company affiliates CENTER, a USD-backed digital token called USD Coin (USDC).

    This token was officially released on September 26, 2018. USDC can now be used to buy, sell, and send on Circle Trade and the Poloniex exchange, which was acquired by Circle.

    According to Sean Neville and Jeremy Allaire, Co-Founders of Circle, this stablecoin will be used as a means to convert US Dollars into tokens to facilitate the transfer of value on the public blockchain.

    USDC allows individual and institutional users to deposit US dollars from a bank account and convert them into tokens that can be used on the internet network.

    What is Stablecoin?

    As the name suggests, stablecoin are coins whose price is always stable because their value is backed up by real assets.

    For this purpose, Coinbase uses the United States dollar as the "hold on value" for the USDC coin.

    As a milestone Coinbase supports stablecoins, which are different from other cryptocurrencies.

    USDC was created to represent 1USD with a fixed rate that does not move up or down relative to its reference currency. One USDC is a 1: 1 representation of the US dollar on the Ethereum Blockchain.

    Any USDC issued must be 100% guaranteed by the associated USD held in an account which is subject to regular public reporting of reserves.

    USDC token is a technology developed collaboratively between Coinbase and Circle.

    Who owns USD coin?

    USD Coin was founded by Circle and it manages a consortium called Center.

    Besides that, it also collaborates with cryptocurrency exchange Coinbase and Bitcoin mining company Bitmain, which are investors in Circle. USDC uses the Ethereum blockchain smart contract which is the leading network for Dapp development using smart contracts.

    Coinbase is undoubtedly one of the leading exchanges with customers from all over the world. Their mission to develop USDC is to open up new opportunities by becoming a world financial system with the ease of using payments only via mobile phones and can be enjoyed by users around the world with low fees and transfer speeds in just a matter of minutes.

    A circle is a company engaged in the Money Transmitter sector which has the support of Goldman Sachs.

    Money Transmitters is a US financial services business that complies with and complies with federal laws and regulations.

    So that in issuance all USDC tokens are regulated, transparent and verifiable.

    How does the USD coin work?

    In simple terms, the way USDC works are that the user pays an amount of USD to the token issuer, then the token issuer will ask the smart contract to create a token according to the request, then the issuer will send the USDC token to the user and reserve the USD into the currency backup.

    Circle guarantees that every 1 USDC is backed up with 1 USD, so the issuer is not arbitrary in minting USDC coins. The process of buying USD tokens to USDC is called tokenization.

    Meanwhile, when a user wants to exchange USDC for USD, the steps are the same but with a reverse process, where the user asks the issuer to exchange USDC for USD, then the publisher will use a smart contract to process the transaction, then USD will be sent to the user deducted with the existing fees.

    All USDC transaction data must then be reported and will be published by Grant Thornton LLP so that all USD tokens and currencies can be known transparently.

    The report can be found here.

    How to use USD coin

    USDC is an ERC20 token on the Ethereum blockchain with a value of 1: 1 against USD, ERC20 tokens can be used in any application that meets standard requirements.

    To use USDC with Circle, you need to register an account and then completed the KYC verification process. Next, you have to connect a legimitated bank account, a bank account error or being rejected can be subject to a fee of $ 50.

    By using the Circle USD platform you can do several things, tokenize USD, make USDC redeem, transfer USDC to ERC20 tokens to a compatible Ethereum wallet address and also deposit USDC using an external Ethereum wallet.

    For tokenization and redeem services, Circle does not charge a fee, but if there is a bank transfer error or it is rejected, a $ 50 commission will be charged as mentioned above.

    If someone is going to make a redemption, it will be processed during the working day which takes approximately 24 hours, with a minimum redemption of 100 USDC.

    By using USDC there are several that provide convenience, including:

    • It can make it easier to buy cryptocurrency in the future.

    • Avoid third-party intermediaries like traditional institutions.

    • Avoiding high inflation that may occur as in Venezuela.

    • Send money globally at a low cost.

    •  Allow to used buy items such as games, in Dapp more easily.

    • USDC is also a programable dollar that allows it to be used for business development and fintech.

    Who accepts USD coin?

    Coinbase is a USD coin support company, so this exchanger automatically accepts USD coins. However, from the Coinbase blog, it is explained that Coinbase Commerce has accepted USDC as a cryptocurrency backed up by USD reserves.

    Coinbase Commerce is a service for traders so that it can accept multiple cryptocurrencies directly into user-controlled wallets.

    The service can be integrated directly into merchant payment streams or added as a payment option across all popular e-commerce platforms such as Shopify or WooCommerce. To be eligible to use this service, you must register on Coinbase Commerce and take the verification step.

    Besides, several other merchants accept USDC as quoted from the Coinbase site, such as Abacus, Bitpay, Centrifuge, Compound, Dharma, Dydx, Melonport, Nexo, Nitrogen. Ledger, Opensea, Loom, Origin.

    Where to buy USD coin?

    Users can trade USDC on any of the listed exchanges citing from the Coinbase database, through the following exchanges.

    How safe is the USD coin

    This question will probably be important for crypto investors that looking to hold USDC in the long term.

    How safe is USDC, if you look at the fact that the stablecoin is not pegged at a flat value of $ 1. If you look at the history of the price of stablecoin, for example, USDT, this can fluctuate in price up to and down.

    For example, the USD Coin (USDC) price has increased to USD 1.01 on 20 March 2019. This means that USDC tokens are more volatile than USD as reserves.

    Another reason that USDC can be dangerous is that it is not bubble proof because this asset has volatility, so there may be conditions that cause this asset to fall deeply or rise quickly, for example to $ 10 or $ 20.

    This condition may occur because when Bitcoin surged it was often followed by other crypto assets.

    Is USD coin a good investment?

    One reason is that this is pegged at a value equal to 1USD, although stablecoin can also go up and down, compared to the percentage of ups and downs, it is only small, but what needs to be considered is the value of the USD itself.

    In crypto, tokens are usually limited so that the issue of inflation can be suppressed, but when the USD is printed large, this allows a country to experience high inflation.

    Let's say that currently $ 1 is enough to buy a packet of bread, but when the money supply is too high and causes inflation, the money that was original $ 1 is not enough to buy bread.

    So, for example, if you have now invested USDC and kept it in your wallet for decades to come, it might be enough right now to buy bread, but because of inflation the same amount of USDC is no longer enough to buy bread.

    USD Coin price prediction

    Stablecoin is pegged at $ 1, but in practice, the value changes frequently on the marketplace. This can occur due to an imbalance in demand and supply of the stablecoin token itself.

    The following are some USD coin predictions from several well-known forecasting sites:

    Tradingbeast USDC price prediction

    Tradingbeast predicts the USDC price could reach $ 1.2835870 in December 2020. The highest price is predicted at $ 1.6044033, and the lowest price is at $ 1.0909942.

    USDC's December 2021 prediction reaches a minimum of $ 1.0898556, while the December 2022 prediction reaches $ 1.0872712, then 2023 USDC is predicted to reach $ 1.0823643.

    Wallet Investor SDC price prediction

    Meanwhile, Wallet Investor predicts future USDC prices with high changes, although it doesn't make sense, this is their prediction based on its calculation algorithm.

    It is predicted that the USDC in the next year will increase to $ 34,376 and the forecast for the next five years is $ 88,797.

    Short-term prediction

    In the short-term prediction, there is a deviation that can occur in USDC up or down in the range of deviation in the short term.

    Source wallet investor.

    Long-term USDC prediction

    Long-term predictions by wallet investors predict prices will go up and tend to be bullish on long-term expectations.

    Source wallet investor.

    Digitalcoin USDC price prediction

    Digitalcoin, which is also a well-known forecasting site, predicts the USDC price at the end of 2020 to reach $ 1.89, a prediction of 2021 at $ 1.95, a prediction of 2022 at $ 2.97, a prediction of 2023 at $ 3.53, a prediction of 2024 at $ 3.99, a prediction of 2025 at $ 4.53, and a prediction of 2026 at $ 4.08.


    Source Digitalcoin.

    Coincheckup USDC price prediction

    With a different analytical approach method from other forecasting sites, Coinchekup uses money flow worldwide data of money in circulation compared to the number of tokens in circulation, they predict that the value graph will increase.


    Source Coincheckup.

    Cryptoground USDC price prediction

    Cryptoground is also one of the crypto forecasting sites predicting the price of USDC after one year of $ 1.1667 to increase by 16.67%, and a five-year prediction, meaning that in 2025 from now, the USDC price will be $ 3.1091 with a growth of 210.91%.

    Based on these predictions, it can be concluded that the USDC Cryptoground expectations are a good investment for the future.

    USD Coin News Update

    Citing from Ambcrypto reports that Coinbase and Circle, two companies that are members of the Center consortium, have announced that they have upgraded the USDC stablecoin and Smart contract.

    The purpose of this upgrade is to make payments resemble the payment services offered by existing mobile payment applications.

    So that customers can send and receive USDC and also pay transaction fees on USDC stablecoin.

    On the other hand, this feature allows entities that offer USDC payment options to pay for fuel on behalf of their users.

    It also offers developers the option to provide transaction fees themselves or allow third-party services to pay fees.

    From the Center Consortium blog state if the 'USDC 2.0' upgrade will increase the security features in USDC smart contracts.

    This version also introduced a new set of multi-signature contracts on-chain.

    This means that the feature will include a new consensus mechanism that will primarily address security issues. At press time, USDC stablecoin in circulation has reached 2.7 billion.

    Conclusion

    USDC growth has been extremely fast, in several months it has seen an increase of more than one billion in circulation.

    Although in the long run the USDC value is strongly affected by USD inflation, for use in cryptocurrency it is very easy to make transfers and purchases of crypto.

    Plus this token is supported by Coinbase which is a popular crypto exchange so the use of USDC can easily increase.