The result of developments in both crypto technology and regulation, Circle’s new USDC API provides a bridge between crypto and traditional finance.
Circle, the company behind the second most popular stablecoin USD Coin, has rolled out a new API that will allow for the seamless transfer of USDC to USD via automated clearinghouse (ACH) systems.
The first exchange to adopt the new API will be derivatives and futures specialist FTX, looking to speed up USD settlement processes on behalf of their customers.
In a blog entry, project manager Gee Chuang described how Circle’s ACH API improves connections between the fiat world and the digital world by introducing interoperability among payment rails, such as card, wire and blockchain transfers. Using the API, USD funds can be transferred easily between banks and blockchains with processing traditionally done manually, now automatic.
“Circle APIs give us a fast, reliable and trusted infrastructure for connecting bank transfers to our new retail products, and with settlement into USDC across Ethereum and Solana, this gives FTX the ability to offer the fastest experience for crypto investors.”
— Jeremy Allaire (@jerallaire) January 26, 2021
Circle has partnered with Plaid, a company that specializes in online account security and verification, to provide a process for streamlining USD/USDC transfer through Circle. Chaung said:
“This process prevents common errors like mistyping bank accounts or routing numbers and ensures greater user security, while reducing fraud reversal risks. No digging around for numbers, no clunky codes, no switching between applications during the process.”
More than 50 countries use some version of ACH payment processing, including the EU, United States, United Kingdom, China, Japan and South Korea. Circle has also partnered with Visa to process crypto-related payouts across 30 countries covered by their network.
USD Coin is primarily an Ethereum-based token that can be exchanged for US dollars on a 1:1 basis and is backed by a reserve of regularly-audited assets. Launched in Oct. 2018 as an alternative to Tether, there are currently about 5.4 billion USDC in circulation, making it the second biggest stablecoin by market cap, after USDT.
Demand for USDC has been at an all-time high, setting weekly volume records during the first three weeks of the new year. In addition to being used heavily at Binance and Coinbase, USDC is also a stablecoin favorite among DeFi traders, with platforms like Uniswap, Curve and Compound accounting for hundreds of millions in daily trading volume.
USDC for redeemability of $1 at CEXs and holding $1 peg
USDT for liquidity
DAI for stablecoin interest earning
I don’t use TUSD ever
— DeFi Dad ⟠ defidad.eth (@DeFi_Dad) January 23, 2021
Circle CEO Jeremy Allaire has long been a proponent of integration between the digital currency space and traditional finance, appealing to the U.S. Treasury Department in Dec. 2020 to allow crypto industry collaboration in the regulation development process.
Speaking at a fintech festival earlier that month, Allaire predicted that upcoming breakthroughs in blockchain technology will encourage massive adoption, putting its potential benefits “in the hands of hundreds of millions, if not billions of users.”
Well before the coronavirus pandemic, global economists expected a grim-looking American economy and during the last ten months of the Covid-19 outbreak, the U.S. financial system looks even worse. Economists and analysts say the biggest concern is the U.S. dollar faltering into the unknown, as a great number of distinguished individuals believe the USD will […]
The post Financial Analysts Expect US Dollar to Soften Further, 2021 Could Be the Greenback’s ‘Worst Year Ever’ appeared first on Bitcoin News.
Since 2010, inflation has turned $1 into 84 cents while $1 invested in Bitcoin would be worth $274,000.
Bad news — the increase in the Bitcoin (BTC) price over the past decade may have been overstated because of the accompanying fiat inflation. Since Bitcoin is typically denominated in fiat — United States dollars usually — it is not immune to its depreciation.
In the decade that followed the economic crisis, the U.S. enjoyed some of the lowest inflation in history, which hovered around 2% annually. However, over the decade, this added up to almost 20%. Thus, if we use the 2010 dollar as our base and apply its subsequent depreciation to the price of Bitcoin, then the current price of $10,466 turns into $8,770. Though this may be a sobering realization for some long-time hodlers, it does not mean that Bitcoin was a bad investment or that it is not a good store of value.
On the contrary, if we compare the performance of Bitcoin and USD in the last decade (again adjusted for inflation), then there is no comparison. One dollar invested in USD would have turned into 84 cents, while one dollar invested in Bitcoin would be worth $274,000. Cryptocurrency has clearly done a much better job of value preservation.
Bitcoin is not immune to inflation either, but that might over complicate the story somewhat. As long as the fiat inflation rate stays low and Bitcoin continues to appreciate at a rapid pace that it has done until recently, the effect of fiat inflation may be negligible for most investors. The only way to escape it completely would be to stop denominating Bitcoin in fiat. Then, perhaps, 10 years from now, we would be discussing how many Satoshis one might hope to buy with a dollar.