Coinbase Increases Support for Stablecoins through Equity Stake in Circle
Crypto exchange Coinbase has announced that it is strengthening its support for stablecoins by taking an equity stake in Circle. Under the agreement, Circle will have full control over the issuance and governance of the USDC stablecoin, which will also be launched on six new blockchains. The exact terms of Coinbase’s investment have not been disclosed. Coinbase CEO Brian Armstrong and Circle CEO Jeremy Allaire stated that this investment will result in greater alignment between the two companies on the future of the financial system. The launch of USDC on the new blockchains is expected between September and October.
Key Points:
– Coinbase is increasing support for stablecoins by taking an equity stake in Circle.
– Circle will have full control over USDC issuance and governance.
– USDC will be launched on six new blockchains.
– Exact terms of Coinbase’s investment have not been disclosed.
– Coinbase and Circle will share revenue from USDC reserves interest income.
In addition, Coinbase reported a decrease in USDC stablecoin interest income in the second quarter due to a decrease in USDC market cap. Meanwhile, PayPal has announced its plans to launch its own stablecoin, PYUSD, with the support of Paxos. The stablecoin will be fully backed by U.S. dollar deposits and similar cash equivalents.
Hot Take:
Coinbase’s investment in Circle and the expansion of USDC to new blockchains demonstrates the growing importance of stablecoins in the crypto industry. With PayPal’s entry into the stablecoin market, it remains to be seen how this will impact the overall financial landscape and the adoption of stablecoins in everyday transactions.
By
By
By
By
By
By