Cryptocurrency has taken the world by storm and by many accounts, “gone mainstream.” There are plenty of use cases for digital currency in the modern world: easy international transfers without having to worry about forex exchanges, private transactions, and more.
But one thing that has held crypto back from becoming an everyday currency is its inherent volatility. While currencies such as the U.S. dollar and the Japanese yen fluctuate, they don't do it nearly as much as cryptocurrencies. Even for the bigger and “safer” cryptocurrencies such as Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH), it is not unusual to see 3% to 4% price movements on a day-to-day basis.
Because of the volatility, Bitcoin and Ethereum are not great options for sending large sums of money. For example, if someone sent $10,000 of Bitcoin to a friend, it could be worth only $9,500 by the time it gets to them.
In comes Jeremy Allaire, CEO of Circle. Allaire wanted to create a way for people, no matter where they are in the world, to be able to easily exchange money.
“On the internet today, I can download a piece of software like WhatsApp or open up Google Chrome, and I can connect to anyone else directly,” Allaire said. “That model is so straightforward. So why can’t we do that with money?”
So Allaire and Circle sought to create an asset that had all the benefits of cryptocurrency and the stability of the traditional dollar. In 2018, Circle created USD Coin (CRYPTO: USDC), a cryptocurrency tethered to the U.S. dollar.
See Also: Watch the full interview with Jeremy Allaire with Benzinga CEO Jason Raznick here.
Allaire lays out the function of USDC: a digital currency easily exchanged with anyone in the world, bypassing the logistical hurdles and fees of traditional wire transfers.
Circle also offers generous interest rates for USDC investors, currently 5% for a 12-month investment. This is almost double what someone could get in their local bank.
Circle is going public via special purpose acquisition company Concord Acquisition Corp (NYSE:CND).
