Circle Reveals Assets Backing USDC Stablecoin

Crypto's No. 2 stablecoin is backed mostly – 61% – by cash and cash equivalents. Here's what comprises the rest.

AccessTimeIconJul 20, 2021 at 1:41 p.m. UTC
Updated May 15, 2023 at 1:45 p.m. UTC

Presented By Icon

Election 2024 coverage presented by

Stand with crypto

The majority of Circle’s USDC stablecoin is backed by U.S. dollars, the company revealed on Tuesday.

Circle, a global payments company, was one of USDC's creators. It published a breakdown of its assets backing the stablecoin for the first time in its latest attestation report, which was dated July 16. According to the report, about 61% of its tokens are backed by “cash and cash equivalents,” meaning cash and money market funds.

Yankee Certificates of Deposit – meaning CDs issued by foreign (non-U.S.) banks – comprise a further 13%, U.S. Treasuries account for 12%, commercial paper accounts for 9%, and the remaining tokens are backed by municipal and corporate bonds. 

The company has issued about $22.2 billion worth of USDC, according to the attestation.

It’s unclear what, specifically, Circle has invested in to back USDC. The company intends to go public later this year in a merger with a special purpose acquisition company that would value Circle at $4.5 billion.

According to footnotes in Tuesday’s attestation, the commercial paper has a “minimum S&P rating of S/T A1,” meaning S&P Global Ratings regards the issuer’s ability to meet its financial obligations as being strong.

Circle joins Tether in publishing a rough breakdown of its asset reserves, at least partially answering questions about whether its stablecoin is fully backed. Like Circle, Tether also uses commercial paper to back its USDT token, though commercial paper accounts for far more of Tether’s reserves than Circle’s does.

UPDATE (July 20, 2021, 14:27 UTC): This story has been updated with additional context.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information have been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of the Bullish group, which owns and invests in digital asset businesses and digital assets. CoinDesk employees, including journalists, may receive Bullish group equity-based compensation. Bullish was incubated by technology investor Block.one.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.