In addition, Circle revealed that tokenized U.S. dollar coins — Circle USDC (USD Coin) — supported by the CENTRE open source framework will soon be available.
“Circle USDC (USD Coin) is a solution that enables customers to purchase and use USDC fiat tokens for payments and trading in the crypto ecosystem,” the company wrote in a blog post. “USDC provides a full reserve U.S. dollar-backed stablecoin, and is based on the open source fiat stablecoin framework developed and governed by CENTRE, which will provide independent oversight of Circle’s offering.”
Circle’s new USD Coin aims to solve the issue of volatility that is often associated with the use of digital currencies.
“It unlocks an incredible amount of power for the dollar,” said Jeremy Allaire, CEO of Circle, according to CNBC. “It's basically a dollar that operates on blockchain.”
Circle customers will have to hold $1 for every USD Coin in order to keep the price stable. And while companies such as Tether and Basis also have “stable coins” with a value tied to the U.S. dollar, Allaire noted there’s a need for a “compliant alternative” to Tether, which has a $2.2 billion market cap.
“When I look at the convergence of traditional finance and the crypto space, it's begging for that,” Allaire said. “There are a number of banks who are excited about it and will support it.”
Once U.S. dollars are transferred to Circle’s USD Coins, Allaire said they can be moved within seconds using blockchain. There are plans to eventually add tokens for the euro and pound.
The USD Coin is being run on Ethereum, but Allaire said the company is open to using other platforms.
“Ethereum is the best bet, but it's not necessarily the end game,” he said. “For now it's specifically on Ethereum.”