Circle, one of the world’s leading crypto companies, has indicated that Stablecoin USDC will be 100% backed by cash and US Treasuries, in the short term.
Aware of the feeling of the community, of our commitment to trust and transparency. In addition to an evolving regulatory landscape, Circle, backed by Coinbase, has announced that it will now hold the USDC reserve entirely in cash and US Treasuries.
By the way, last month Circle revealed that only 61% of tokens were backed by cash and cash equivalents. That is, cash and money market funds.
Specifically, Circle published a certification report, dated July 16, a breakdown of its assets that support Stablecoin USDC. In fact, according to the certification, the company issued around $ 22.2 billion in USDC.
USDC will be 100% cash backed
According to an announcement from Circle, the September certification will show that all of USDC’s reserves are held in cash and short-term US Treasuries.
Very importantly, the company has stated that these updates will not be reflected in the current support disclosure. But in the future, the claims made by listeners Grant Thornton.
In this regard, Coinbase President and COO Emilie Choi posted a Tweet. Specifying that from September 2021, USDC reserves will be held in cash. Also, in the short-term treasuries of the United States government.
1 / Quick update on the USDC. From September 2021, USDC reserves will be held in cash and short-term US Treasury bills. This is the approach we want for the USDC reserves. https://t.co/29liaGg2LA
– Emilie Choi (@emiliemc) August 23, 2021
“Stablecoin has always been fully backed by reserves equal to or greater than the USDC in circulation. This gives users the ability to always exchange a USDC currency for a dollar.
He added that Coinbase will ensure that USDC investments return to a “more conservative investment profile” by the end of next month.
Circle intends to go public
For its part, in July, Circle revealed its intention to go public later this year. Through a Special Purpose Acquisition Company (SPAC) Concord Acquisition Corp. in a deal that values ​​Circle at $ 4.5 billion.
For this reason, Jeremy Allaire, CEO of Circle, said: “With such a strategic transaction and the final public debt, the company is taking another step forward. That it can help businesses around the world connect to a more efficient, inclusive and open global economic system.
Fun fact, Allaire said the desire to go public came from the growth Stablecoin USDC was experiencing over the past year.
Become a commercial bank?
In this regard, earlier this month. Circle has announced its intention to become a fully-fledged national commercial bank. It operates under the supervision of the United States Federal Reserve and the Department of the Treasury. Likewise with the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC).
Specifically, in a regulatory brief released on Monday, August 9, Circle said it plans to promote a national bank letter. To move some of your payment processing services in-house.
“As part of our strategy to reduce our dependence on third parties, in the future we may consider obtaining US domestic banking status or evaluating the acquisition of a domestic bank. This would allow us direct access to the Federal Reserve system, reducing the time and costs of settling transactions.
I end with this sentence from Solon of Athens: “Learn to govern yourself before you govern others.