Highlights From Circle’s Latest USDC Reserve Report
USDC stablecoin issuer Circle has published its reserve report for December 2022. The report highlighted several assets used as collateral to back over 44 billion USDC tokens.
The world’s seventh-largest independent accounting firm – Grant Thornton, audited Circle’s latest reserve report. Grant Thornton analyzed the existing makeup of Circle’s stablecoin reserve and reported that over 44.5 billion USDC is supported by over $44.6 billion in various accounts.
An Audit On Circle’s Reserve Assets
It is worth mentioning that a huge percentage of the $44.6 billion is in various treasury bonds in the United States. Circle VP Timothy Singh explained that the total estimate of the USDC reserve assets is equivalent to the sum of USD assets, including a combination of liquid USD and treasury bonds.
The funds in Circle’s reserve can be considered money market funds – funds withdrawn from investors and used to purchase government securities. However, interest from the fund’s equity is completely owned by Circle.
Circle’s purchases include 14 United States treasury bills worth about $48 million. Additionally, the USDC issuer expects gains of about $33 million is expected from the interest on the funds.
According to the audit report, the stablecoin issuer has two other United States securities worth over $10 billion in different reserve assets and over $10 billion kept in various reputable financial institutions.
At the 2023 World Economic Forum in Davos, Corey Then, Circle’s VP of Global Policy, stated that the company held talks with policymakers, traditional firms, tech companies, and humanitarian organizations to explore the potential of USDC as a payment settlement option.
In recent years, USDC has become the second most utilized USD-pegged stablecoin, second only to Tether (USDT).
Blockchain Advancement And Adoption
As blockchain advancements continue to progress, cross-border transactions are expected to rise. Therefore, the industry’s success depends on the widespread adoption of the technology and the fulfillment of users’ needs.
Stablecoins, being a valuable innovation from the world of cryptocurrency, have the potential to satisfy this demand. Consequently, the company that can merge the advantages of Web3 technology with a user-friendly Web2 experience will dominate the market.
In the context of payments, this means combining the benefits of fast and cost-effective crypto transactions while complying with the strict regulations imposed by the US and Europe on payment service firms.
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