USD Coin or also known as USDC, is a cryptocurrency referred to as a stablecoin. You can redeem a one USD coin for one U.S. dollar, providing it a stable price. In addition, eligible customers can earn rewards on Coinbase for every USD Coin they hold.
What is USD Coin?
USDC is a relatively new stablecoin pegged to the U.S. dollar launched on September 26, 2018, in collaboration between Coinbase and Circle. This cryptocurrency is an alternative to others like the USD-backed TrueUSD (TUSD) or Tether (USDT). To put it simply, USDC is a service that tokenizes U.S. dollars and facilitates their use over public blockchains and the internet. Additionally, USDC tokens can be reverted back to U.S. dollars at any time. Furthermore, the execution of redeeming and issuing USDC tokens is ensured with the ERC-20 smart contract. Bringing the USD on the blockchain permits moving them anywhere in the globe within mere minutes and supplies cryptocurrencies with the much-needed stability. In addition, it opens up new opportunities for lending, risk-hedging, trading, and more.
How do you use USDC?
The USD Coin is a 1 to 1 representation of $1.00 on the Ethereum blockchain. It’s an ERC-20 token and is in use with every app that supports the standard. Generally, stablecoins such as the USDC are used to avoid traditional financial institutions and instruments and short cryptocurrencies without the need to cash out and make it easier to purchase cryptocurrencies in the future Avoid hyperinflation Send money globally, securely, at low cost, and instantly Buy items in various exchanges, blockchain-based games, and crypto apps.
How does one invest in USD Coin?
- Open an online account The best way to purchase USD Coin is through Coinbase. If you already have your account, you can effortlessly convert USDC or other types of cryptocurrencies into USDC. If you still haven’t set up an account with Coinbase, it’s pretty easy to make one. You simply have to put your email, create your password, and you’ll have your very own account in Coinbase. Due to the Securities and Exchange Commission (SEC) Know Your Consumer (KYC) regulations, you’ll be required to give Coinbase your personal identification information before you can start trading cryptocurrencies. You can purchase USDC using Ether tokens on a decentralized exchange if you already own crypto. After you send your Ether tokens to MetaMask, you can trade them for USDC on Uniswap.org.
- Buy a hardware wallet (optional). You should not store your cryptocurrency, including USD Coin, on an exchange. Instead, it would help if you keep your crypto in a dedicated cryptocurrency wallet.
- Make your purchase. To make purchases, you’ll have to fund your account first. It’s easy to connect your bank account to Coinbase, and you can choose to fund your account through a debit card or ACH transfer. Since USDC is almost always equal to $1, you don’t need to time the market to purchase your USD Coins. If you’re fortunate, you can snag your USD Coin at a discount, but don’t expect the rate to drop below $0.99.