USD Coin (USDC) is a type of cryptocurrency known as a stablecoin. It is designed to maintain a stable value by being pegged to the US dollar on a 1:1 basis. This means you can always redeem 1 USDC for 1 US dollar, providing price stability in the often volatile crypto market. On platforms like Coinbase, eligible users can even earn rewards simply by holding USDC in their accounts.
What Does USDC Mean?
USD Coin (USDC) is a digital currency whose value is directly tied to the US dollar (USD). It operates on several blockchain networks, including Ethereum, Stellar, and Solana. Unlike more volatile cryptocurrencies like Bitcoin or Ethereum, USDC is a stablecoin because it is backed by real-world fiat currency held in reserve. This structure aims to combine the benefits of digital assets—such as fast transfers and global accessibility—with the stability of traditional money.
How to Buy USDC on Coinbase
Purchasing USD Coin on Coinbase is a straightforward process. Here’s a step-by-step guide:
- Create a Coinbase Account: Download the Coinbase app and complete the registration process by providing the required information and verifying your identity.
- Add a Payment Method: Link a payment method to your account, such as a bank account, debit card, or wire transfer.
- Start a Trade: Navigate to the "Buy/Sell" section on the platform.
- Select USD Coin: From the list of available assets, choose USD Coin (USDC).
- Enter the Amount: Specify the amount of USDC you wish to purchase.
- Confirm and Finalize: Review the details of your transaction, including any fees, and confirm the purchase.
Your USDC will then be available in your Coinbase wallet.
USDT vs. USDC: Which is Better?
Both Tether (USDT) and USD Coin (USDC) are leading stablecoins, but they have key differences. USDT generally has higher trading volume and liquidity, making it easier to swap between other cryptocurrencies and this stablecoin. However, USDC is often praised for its transparency and regular attestations regarding its dollar reserves. The choice between them often depends on whether a user prioritizes deep liquidity or perceived regulatory compliance and transparency. 👉 Compare stablecoin features in-depth
What is the Value of USDC?
The primary goal of USDC is to maintain a stable value. Its price is consistently targeted at $1.00. While minor fluctuations can occur due to market dynamics on exchanges, these are typically minimal, and the value quickly returns to its peg through arbitrage opportunities.
Frequently Asked Questions
What is a stablecoin?
A stablecoin is a digital currency designed to minimize price volatility by being pegged to a stable asset, like the US dollar or gold. This makes it suitable for payments, savings, and as a safe haven during market turbulence.
Who issues USD Coin (USDC)?
USDC was launched in September 2018 by Centre Consortium, a joint venture between the cryptocurrency exchange Coinbase and the fintech company Circle Internet Financial.
Which networks support USDC?
Originally launched on Ethereum, USDC has expanded and is now also native to other blockchains, including Solana, Stellar, and Algorand, allowing for faster and cheaper transactions across different ecosystems.
What cryptocurrencies can I buy on Coinbase?
Coinbase supports trading for a wide array of digital assets. Major ones include Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), Bitcoin Cash (BCH), Ethereum Classic (ETC), and many other altcoins and tokens.
Is USDC safe?
USDC is considered one of the more secure and transparent stablecoins. Its issuers claim it is fully backed by reserved assets, which are held in audited accounts and consist of cash and short-duration U.S. Treasury bonds. Regular attestation reports are published to verify these reserves.
What are the most used stablecoins?
The most prominent stablecoins by market capitalization and usage are Tether (USDT), USD Coin (USDC), and Binance USD (BUSD). Each has its own characteristics concerning reserve backing, issuers, and supported platforms.