USDC SCAM OR TRUSTWORTHY? IS IT SAFE TO INVEST?

B
Comments: 0Views: 90

Blockchain247

Bforum Member
Staff member

There are hundreds of cryptocurrencies and blockchain projects working to transform the world of finance at a global scale. In this article, we'll take a look at USDC, one of the most popular stablecoins on the market today. What is USDC? Is it a scam? Let’s find out the answer.

Understanding USD Coin (USDC)​

U.S. Dollar Coin (USDC) is one of the most popular stablecoins —a type of cryptocurrency that keeps its price pegged to the same price as another asset, in this case, the U.S. dollar with the value of one USDC coin pegged 1:1 to the value of one U.S. dollar.

The coin was launched on September 26, 2018, in collaboration with Coinbase and Circle. USDC is a substitute for other cryptocurrencies backed by U.S. dollars, like TrueUSD (TUSD) and Tether (USDT). The value of USDC is designed to remain stable, making USDC a stablecoin.

USDC is one of the most popular cryptocurrencies today and it has the following key features and takeaways:​
  • USDC was designed to facilitate the onboarding process as a result of the complex nature of User interfaces and the functionality offered by cryptocurrencies.​
  • The USDC protocol was developed to give the general public easier access to cryptocurrencies. USDC was created so that the crypto industry can be user-friendly.​
  • USDC reserve assets are held in segregated accounts with U.S.-regulated financial institutions.1​
  • USDC is not issued by the U.S. government.​
  • USDC is listed on several other major cryptocurrency exchanges and it also helped bootstrap the liquidity of the stablecoin rapidly. Since it became available for trading in more than 80 countries, USDC saw a significant increase in popularity.​
  • Another factor that made USDC popular is the emergence and spread of Covid-19 in 2020 when investors started using USDC as a hedge against fiat currencies.​

Advantages and Disadvantages of USDC​

There are advantages and disadvantages to using USDC stablecoin. This chart outlines the biggest pros and cons.
Pros
Cons
Price stability​
No potential for price appreciation​
Lots of liquidity​
Depending on the current state of the Ethereum network, transaction fees can be high​
Good reputation and is backed by Circle’s assets​
Fees for withdrawing USDC from exchanges can also be high​
Regulated and audited
Stablecoin competition
Blockchain connectivity​
The field associated with stablecoins is competitive and USDC is second to USDT​

Is USDC Safe?​




USD Coin’s main advantage is that it enables people to buy and sell other cryptocurrencies without having to move fiat currency in and out of exchanges.

USDC can be transferred 24/7 and is faster to send than traditional currencies, with settlements occurring in seconds. Transaction costs are low cost, making it cost- and time-efficient to use.

In the words of Jeremy Allaire, founder and CEO of Circle, “What makes USDC such a great product is that it’s easy to create and redeem, with seamless integration with the existing global banking system. As a result, customers are able to use it as a very efficient pipe between legacy electronic dollars and digital currency dollars.”

There are still downsides to using USDC. For one, there is no price appreciation. Users should also be aware of the regulatory landscape surrounding digital currencies and stablecoins. Crypto experts also say that government regulations against these digital assets could have a crippling effect on the future of these assets.

There are also many rumors about this token. Recently, on Twitter, information about the USDC collapse has been spreading very quickly and the community’s skepticism has also been raised through the high social signal index. This stems from an account named Geralt Davidson who tweeted with the title “USDC on the verge of collapse?”. Quickly, this tweet was noticed by the community and people started pouring into this rumor.

Although there has been no evidence to support these rumors, there are always risks when it comes to investing your money online. One company that manages USD Coin could go bankrupt, or stablecoin regulations could affect their usage.

However, these risks are minimal compared to the risks of other cryptocurrencies. While stablecoins like USDC have less price volatility than other cryptocurrencies, stablecoins may be subject to increased scrutiny by regulatory agencies like the U.S. Securities and Exchange Commission. Investors should know the risks before purchasing USDC.

Are USDC A Scam? We can't confirm yet. Please, however, do it in a responsible manner. Don't invest a lot of money in USDC and always go for low-cost positions. Otherwise, you may find yourself in a difficult situation, both financially and emotionally. Leave your impressions about USDC at the comment section down below.
 

Please login or register to comment here.

Members online

No members online now.

Forum statistics

Threads
1,089
Messages
1,133
Members
1,008
Latest member
ntna
Top