Circle CEO reveals details of USDC backing

Circle co-founder and CEO Jeremy Allaire presented details of how the USD Coin (USDC) stablecoin operates. The initiative is aimed at bolstering trust amid industry difficulties following the Terra collapse.

1/ With so many firms facing fundamental challenges and risks, Circle has amped up our own information about Circle and USDC. Sharing it here so it’s fresh for people to review. We started publishing these in the days following the Terra collapse. https://t.co/SYNpwYxUif

— Jeremy Allaire (@jerallaire) July 2, 2022

USDC reserves are held at leading U.S. financial institutions such as BlackRock and Bank of New York.

Of the $50.6 billion in collateral as of May 13, $39 billion (71.1%) consisted of Treasuries with maturities of three months or less, and $11.6 billion in cash.

On a monthly basis Circle publishes reports of compliance of USDC issuance with reserves, and annually it undergoes an audit by one of the industry’s leading firms.

Holding an MTL license, the company and its operations are under federal oversight.

The co-emitter of the stablecoin will begin providing weekly, and subsequently daily, reports on USDC issuance and redemption. For Circle account holders, the operations effectively occur in real time.

Allaire pledged to disclose details of Circle Yield within a week. The product is positioned as a regulated investment contract, accessible only to accredited market participants.

In June 2022, Circle introduced the euro-pegged stablecoin Euro Coin (EUROC).

In April Allaire said the company was preparing to apply for a cryptocurrency bank charter in the United States. He said this should happen “in the near future”.

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