Coinbase and Circle Partner to Strengthen USDC as Centre Consortium Ends
The post Coinbase and Circle Partner to Strengthen USDC as Centre Consortium Ends appeared first on Coinpedia Fintech News
Coinbase (COIN) has acquired a minority stake in Circle Internet Financial, coinciding with the restructuring of the Centre Consortium partnership, responsible for issuing USD Coin (USDC), the second-largest stablecoin globally. This transition places UDC’s issuance and governance under Circle’s control, a pivotal development that broadens its impact.
The exact size of Coinbase’s stake remains undisclosed, with both companies emphasizing the absence of a cash transaction. Similarly, the specifics of the six additional blockchains set to support USDC are yet to be unveiled. While Circle previously mentioned Polkadot, Near, Optimism, and Cosmos, Coinbase introduced its blockchain called Base.
Shaping the Future of Stablecoins
These market shifts hold the potential to reshape the dollar-pegged stablecoin landscape. For instance, PayPal’s introduction of the PYUSD token in collaboration with Paxos challenges the dominance of Tether’s USDT and USDC.
Phil McDonnell, Coinbase’s Senior Director of Product Management, envisions USDC extending beyond crypto trading, encompassing foreign exchange, international fund transfers, and financial inclusion. He downplays competition with PayPal, focusing on growing the crypto ecosystem.
Circle Raised $400 Million
Circle’s Chief Strategy Officer, Dante Disparte, highlights evolving regulations for stablecoins, citing the Clarity for Payment Stablecoins Act and Circle’s Payment Institution License in Singapore. Dissolving the Centre Consortium aligns with regulatory clarity goals. Circle’s recent funding of $400 million, including investments from BlackRock and Fidelity, underlines its streamlined focus. Revenue sharing from USDC reserves interest with Coinbase will continue based on holdings and usage.
In a strategic step, Coinbase and Circle’s partnership is poised to redefine the stablecoin landscape, elevating the role of USDC and opening new avenues for broader financial integration.
Filed under: Bitcoin - @ August 22, 2023 6:02 am