Attestation Auditor Officially Verifies Circle’s USDC Stablecoin is Fully Backed by US Dollars
A stablecoin is one of the many classifications of crypto assets, since it is a verified 1:1 ratio with the local currency. Much of the purpose of this type of coin tends to be cashing out, but there is a surprising amount of alleged stablecoins that do not have this type of backing. Luckily, Circle Internet Financial just verified their dollar-pegged USD Coin.
According to Grant Thorton LLP, the US branch of the major auditing firm, the company reached just under $127.5 million in backing last month.
This ensured that there is presently enough in the account to be redeemed for every single token. In fact, their present balance exceeds the total tokens in circulation by $3,413.89. Since these statistics were taken on October 31st, the tokens have risen to 162,968,332 in circulation, though there is a total supply of 163,204,910.03.
Investors should keep in mind that this is not a full audit, but Circle’s chief financial officer Naeem Ishaq has verified the funds that back up the stablecoin. The report also notes that the evaluation was performed with adherence to:
“attestation standards established by the American Institute of Certified Public Accountants.”
This means that the “the nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material misstatement of the Reserve Account Information, whether due to fraud or error.”
The report also explained that the assessment showed that the auditor
“considered and obtained an understanding of internal control relevant to the preparation of, and the Reserve Account Information in, the accompanying Reserve Account Report in order to design procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of such internal control.”
Gemini and Paxos, other issuers of stablecoins, have published their own attestations from firms to show the validity of their holdings. Their audits were also not full evaluations, they still contradict evidence provided by Tether.
Tether was notably in the news recently for offering a letter from Deltec Bank, where they stated they were holding their funds. However, the assets considered in this number have been debated.