Circle co-founder and CEO Jeremy Allaire has revealed the details of how the company’s stablecoin, USD Coin (USDC), works in an attempt to build confidence amid the complexities in the industry following the recent collapse of the Terra ecosystem.
According to him, the USDC reserves are held in leading US financial institutions. Of the $50.6 billion in collateral, $39 billion are treasury bills maturing no later than three months, and $11.6 billion is cash.
Circle publishes monthly reports on the compliance of USDC issuance with reserves. In addition, the company is audited every year by one of the leading firms in the industry.
The company and its operations are subject to federal oversight as it has am MTL license.