Early bird Circle CEO and founder Jeremy Allaire took to Twitter today to tout USDC, Circle’s dollar-based stablecoin while throwing shade at competitor Tether (USDT) – a competing dollar-based stablecoin.
USDC/USDT is the trade of the day. Flight to quality.
— Jeremy Allaire (@jerallaire) May 12, 2022
While algorithmic stablecoin TerraUSD (UST) has lost its footing and can’t get back up, USDC – based on actual dollar reserves or other risk-free assets is holding out just fine.
USDT took a dive early this morning (perhaps why Allaire was up at 4:20AM) cratering to $0.95 – only to recover later. As of this writing, Tether is trading at $0.9926 .
Volume in both USDT and USDC has risen – perhaps due to Tether holders jumping to the competition – as Allaire indicates.
Over the years, Tether has received criticism that it is not fully backed by reserves but has been able to weather the storm and remains the top dollar-based stablecoin in the world. USDC is in 2nd place and closing.
Circle is pursuing a federal bank charter in a move to comply with looming stablecoin regulation that may require stablecoin issuers to have a bank charter or bank charter light. Meanwhile, legislation is moving through Congress that may finally provide specific rules for stablecoins that will be good for the entire crypto market.