Coinbase and Circle’s Centre Looks to Form a Consortium to Issue More USDC Stablecoin Tokens
- Since its inception, USDC has become extremely popular amongst traders across the globe — mainly because it serves as an ideal bridge for those looking to use fiat and crypto assets.
- It is being reported that members of the new consortium will have the ability to create their own financial products using the existing USDC framework.
Over the course of the past year or so, stablecoins have become a regular fixture of the crypto news cycle — primarily because these assets have their values pegged to established fiat currencies such as the US Dollar, Euro, etc. However, since the start of 2019, this digital offering has gained an insane amount of mainstream media traction because of Facebook’s upcoming Libra coin.
With this information in mind, it should be pointed out that Circle and Coinbase — two of the biggest firms currently operating within the altcoin domain — have recently announced their decision to come together and issue Circle’s popular USD Coin offering on a larger scale.
A Closer Look at the Matter
The consortium — that will reportedly be called ‘Centre’ — in its core essence is a membership-based framework and governance scheme that will help promote the adoption of digital assets across the globe. In this regard, it should also be pointed out that the founders of the consortium (namely Circle and Coinbase) are looking to establish a blockchain-based infrastructure that will allow fiat money to be used for monetary tx’s freely over the internet.
At this point in the article, it should be noted that Circle first issued USDC tokens on Coinbase’s native trading platform late last year (October 2018 to be exact). Additionally, from a technical POV we can see that USDC is 100% backed by the United States dollar. Thus, with the aforementioned firms coming together, it is expected that the new consortium will be open to other entities that are looking to issue their very own USDC-based offerings.
Other Key Points Worth Highlighting
According to a recent press release, Circle and Coinbase’s vision is to help devise a host of ‘interoperable protocols’ that will allow for the growth of a more transparent global financial ecosystem.
- To fulfill its vision, the consortium has opened its membership doors to the market at large.
- It is worth noting that this development comes at a time when ‘Tether’ is being faced with a number of legal problems (most of whom are directly related to the firm’s native USDT token).
- Stablecoin offerings such as the USDC token are designed to offer their users with a high level of transparency (all whilst enabling the use of various technologies that are designed to help increase the speed of cross-border tx’s)
What is ‘Center’ Looking to Achieve?
In its core essence, the consortium seeks to make use of USDC so as to enable instantaneous monetary settlements across international borders. To achieve this goal, Center will be partnering with a host of established financial institutions so as to help spur the development of its burgeoning network.
In addition to all this, Center is also looking to achieve a high level of interoperability in order to allow the USDC token to work across a number of different private and public chains.
In this regard, Circle CEO ‘Jeremy Allaire’ was recently quoted as saying:
“Market infrastructure like stablecoins will become the base layer that supports every financial application. It has to be legitimate, trustworthy and be built on open standards.”
Some Key Requirements for Joining the Consortium
As is to be expected, in order for third-party institutions to become part of Centre, they will have to agree with the consortium’s core operational rules. These include:
- Applicants need to be licensed by relevant authorities to support electronic money services.
- Member institutions need to stay in line with Centre’s AML and KYC requirements at all times.
- A certain amount of fiat reserves need to be maintained by the applying institutions.
In closing out this piece, it should be highlighted that as things stand, a huge level of interest has been expressed by a number of big name players towards the consortium. It now remains to be seen how the future of this venture plays out.