Circle & Coinbase decided to follow a new structure to run the USDC stablecoin business globally.
USDC is the second best stablecoin in the crypto sector. This stablecoin was founded in October 2013 by Jeremy Allaire and Sean Neville with the vision of always remaining compliant with financial regulations and maintaining a high level of trust among crypto investors. In 2018, Coinbase Exchange officially partnered with Circle.
On August 22, 2023, Coinbase exchange announced that USDC stablecoin will be launched on 6 new crypto networks ahead of the new plans to grow the USDC ecosystem.
According to the announcement, Coinbase relinquished control of USDC stablecoin financial operations and acquired a small stack in Circle.
In short, under the new structure of the partnership, Coinbase will not be able to interfere in USDC’s financial activities or we can say that Circle will manage all works with great responsibility.
Circle CEO Jeremy Allaire shared his thoughts on this new strategic partnership structure saying that USDC was launched 5 years ago and there were no rules for such things at the time but now the situation has changed so it was necessary to comply with the rules & grow faster.
It is worth noting that early this year the situation for the crypto companies was very bad in the US, as the US Securities Exchange Commission (SEC) was quick to attack crypto companies with traditional securities laws.
At the time, Circle’s CEO said that Circle followed all the rules and regulations and also obtained all the necessary licenses to operate the Stablecoin business in the US jurisdiction, but still faced huge regulatory burdens.
In the first quarter, several large crypto-friendly banks went bankrupt. Circle also kept some money with SVB, which went bankrupt. The whole situation created very high selling pressure and faced a 13% drop from the pegged value of $1.
Later, the Circle team clarified all matters to build trust among the USDC stablecoin users.
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