At a time of cleansing of the crypto markets and stablecoins in particular, Coinbase has made its choice.
Tether does not calm down
Recently, there was an official from Tether, the company that issues USDT interviewed on the proof of reservation. According to observers, he was not reassuring on this issue and cast even more doubt on the reservations mentioned. However, the industry is currently at a crucial stage where proof of reserve guarantees investor confidence. The emptiness of the manager’s responses sparked a flurry of criticism of Tether’s transparency. Given the situation, the Coinbase exchange recommended its users to switch from USDT to USDC. It was in a blog post titled, “Switch to the Most Trusted Digital Dollar.”
The purpose of steps is to protect its investors and its platform from potential panic withdrawals. It should also be said that Circle, the company that issues USDC, recently released evidence of strong reserves.
“USDC is 100% backed by cash and short-dated US Treasury securities held in US regulated financial institutions. It is still redeemable 1:1 in US Dollars (…) Regarding the catastrophic events of this year, we believe stability and trust are paramount (…) We believe USDC is a trustworthy stablecoin and reputable wrote the crypto exchange.
An apology ?
It is important to remember that this decision is not only intended to protect crypto investors. In fact, Coinbase and Circle are the founders of the CENTER consortium that created the USDC. The maneuver would allow USDC to inflate its size in the stablecoin market. It will also allow it to take market share from its competitor. In fact, USDT is the largest stablecoin by market cap. Next comes the USDC.
Coinbase follows in the footsteps of exchange Binance, which launched an auto-convert feature from USDC to BUSD in September. The aim is to support and strengthen the development of the CZ-owned crypto exchange stablecoin.
To encourage users, Coinbase has waived USDT/USDC transaction fees for all global retail customers.
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Far from dampening my enthusiasm, an unsuccessful cryptocurrency investment in 2017 only heightened my enthusiasm. I therefore decided to study and understand the blockchain and its many uses and use my pen to share information related to this ecosystem.