USD Coin, also known as USDC, is a cryptocurrency pegged to the U.S. dollar. USDC is a so-called stablecoin because it is designed to maintain parity with the price of another asset.
Think of USDC kind of like a money-market fund, but in crypto. It’s used by traders or investors who want to keep their money in crypto without exposure to the volatility that goes with Bitcoin or any other non-stablecoin.
USDC trades on most crypto exchanges. It’s also a popular choice within decentralized finance protocols, crypto’s alternative ecosystem of financial products, where stablecoins are loaned out, borrowed, and staked to earn yields.
USDC is backed by about $50 billion in real U.S. dollars and Treasuries. Banks hold the cash, and financial institutions like Blackrock and BNY Mellon hold the Treasuries. That makes USDC the second-largest stablecoin after offshore rival Tether (USDT).
It was created in September 2018 by Centre, a consortium created by Circle and Coinbase that publishes quarterly attestations about its reserves. USDC is known as a centralized stablecoin: Centre is subject to U.S. laws and regulations, and it blacklists addresses from trading the coin. In August 2022, Centre froze over 75,000 USDC after the Treasury Department sanctioned privacy mixer Tornado Cash.
That makes USDC different from decentralized stablecoins, like Dai, whose issuers cannot control who holds them. USDC helps stabilize some of these decentralized cryptocurrencies: Dai holds 53% of its collateral reserves in USDC.
Go deeper:
USDC—attestation reports
See also:
Crypto investing 101
What are stablecoins?
Try it:
MetaMask—buy USDC through in-app swap