Home Crypto Altcoin News Companies Coinbase and Circle join up to promote stablecoin adoption

Companies Coinbase and Circle join up to promote stablecoin adoption

Coinbase announced that Circle’s stablecoin, USD Coin (USDC), will be available for trade on their platform today. Coinbase and Circle also announced their collaboration today, in a joint effort to promote the adoption of cryptocurrencies backed 1:1 with government currencies (also called stablecoins).

USDC

“The underlying technology behind the USDC was developed collaboratively between Coinbase and Circle, in our capacity as partners and co-founders of the new CENTRE Consortium” according to a release today on The Coinbase Blog.

USDC is the first stablecoin to list on Coinbase. Users can send and use USDC globally (except for New York State). Each USDC reportedly has a 1:1 backing of U.S. dollars. This is similar to other stablecoins such as TUSD and USDT.

However, the announcement of USDC on Coinbase may be more impactful than previous stablecoin news. Coinbase has a track record of legal compliance.

“The advantage of a blockchain-based digital dollar like USDC is easier to program with, to send quickly, to use in dApps, and to store locally than traditional bank account-based dollars. That’s why we think of it as an important step towards a more open financial system” explained the Coinbase team, via their blog.

USDC is also an ERC20 token, meaning that it runs on the Ethereum network. Ethereum wallets can store USDC, and there are many Ethereum wallet options to choose from in general.

CENTRE Consortium

Additionally, Coinbase and Circle together form CENTRE Consortium. CENTRE “aims at speeding up adoption of cryptocurrencies backed by actual government currencies like the U.S. dollar”, reports CNBC.

USDC was originally a product of  Goldman Sachs-backed Circle, which bought popular crypto exchange Poloniex back in February as reported by Reuters.

Stablecoin Drama

Stablecoins have made many headlines over the past few weeks. TUSD, GUSD, PAX, USDT, USDC, and HUSD (among a few others) are all lobbying to gain market dominance as the go-to stablecoin solution.

The problem is that prices for stablecoins have not been “stable” in comparison to the U.S. dollar. For example, at the time of this writing, Tether (USDT) is priced at $0.97, according to Blockmodo’s price feed. GUSD even saw price as high as $1.18 at one point last week, according to coinmarketcap.com.

Historically, it seems as though USDT has the most stable history as far as a price that’s pegged to the U.S. dollar. But USDT has made many headlines in 2018 regarding public fears of insolvency. (Insolvency, in this case, means that USDT might not have enough USD to pay out a 1 USD for every 1 USDT.)

Stablecoins claim to have a 1-1 backing by the U.S. dollar. But lately, prices have seen large swings. Is the market waiting for a single stablecoin to rise from the pack? Or will many survive together?

We also reached out to President Trump for a comment on stablecoins. He did not respond as of press time.

*CryptoInsider is sponsored by Blockmodo. As part of our arrangement, we may occasionally link to them and quote them when appropriate. This is done at the discretion of CI staff and CI sponsors have no say in any editorial decisions made by CI.

 

The above is to be considered opinion and not investment advice in any way, as an unbiased media, no one interferes with the Editorial content of CryptoInsider.com, writers have freedom to choose their own direction, members of Crypto Insider do not participate in trades based on content.

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Benjamin Pirus
Benjamin Pirus
BJ is a full time writer, editor, and trader in the cryptocurrency space. He has written many professional articles for numerous ICOs, news sites, and other interested parties in the crypto space. He is also a trader, staying up to date with the crypto markets constantly, and dabbling in traditional financial market trading occasionally.

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