USDC

Key points

• USDC is a stablecoin issued by Circle and pegged to the US dollar on a one-to-one basis, backed by cash reserves and short-term securities.
• It is one of the most widely used stablecoins for payments and settlement, with periodic reserve reports and a strong presence across multiple blockchains.
• It circulates on several networks, allowing users to choose between transaction cost and speed depending on their operation.

What is USDC?

USDC is a fiat-collateralized stablecoin that represents the US dollar on blockchains. Each unit in circulation corresponds to equivalent reserves held by its issuer, Circle. The goal is to offer a digital asset that is always worth approximately one dollar, combining the stability of traditional currency with the agility of on-chain transfers.

How it works

When a qualified customer deposits dollars with the issuer, new units of USDC are created and delivered; when they redeem it, the units are destroyed and the dollars returned. This issuance and redemption mechanism, combined with market arbitrage, keeps the price close to one dollar. Reserves are held in cash and short-term government securities, with periodic reports on their composition.

USDC exists natively on several networks, such as those compatible with the Ethereum virtual machine and Solana. Each network has its own cost and speed, so the same asset can be cheaper or faster depending on where it is moved. Transferring between different networks requires a bridge or the issuer's own service.

Because it is an asset issued by a regulated company, the issuer retains the technical ability to freeze specific addresses when required by authorities.

Why it matters

USDC is one of the main instruments for receiving and settling dollar-denominated value digitally. A freelancer who invoices clients abroad can receive payment in USDC and, when desired, convert it to reais via a crypto off-ramp, typically settling through PIX. This combination shortens timelines and reduces reliance on international bank transfers, which tend to involve more intermediaries, higher costs, and longer settlement times.

Risks and limitations

Stability depends on the quality and liquidity of the reserves and the soundness of the issuer; problems with this backing can lead to a temporary loss of the peg. There is also the risk of address freezing by the issuer and of failures in the network on which the asset circulates. Like any centralized stablecoin, USDC concentrates trust in a specific issuer.