Why do so many USD stablecoins exist?


Why are there so many stablecoins linked to the US dollar if they all fulfill the same purpose? As we shall see in the next sections, several stablecoins functions on various blockchains, enabling access to a variety of crypto assets. While each token is always worth $1, its liquidity, basic value, and usefulness vary. Let’s learn about TrueUSD vs USDC and how they differ.

What exactly is TrueUSD (TUSD)?

TrueUSD was introduced early in 2018. It is intended to be a straightforward, transparent, and trustworthy stablecoin. Due to this, no secret bank accounts or unique algorithms are used.

TrueUSD’s USD assets are dispersed among many bank accounts managed by numerous trust organizations. The parties concerned have signed agreements requiring daily publication of collateralized holdings and monthly audits. The token utilizes several escrow accounts to mitigate counterparty risk and offer legal protection against theft for its holders.

TrueUSD serves:

  • Traders and markets. TrueUSD is an excellent instrument for hedging against market volatility and entering the market without first purchasing BTC/ETH.
  • Mainstream enterprise. People and enterprises may use the advantages of blockchain technology without being susceptible to astronomical price changes.
  • Developing Nations. Developing markets can do business with stable currencies.
  • Long-term financial agreements, such as loans, wages, and market forecasts.
  • With a reliable asset, financial institutions may trade on the bitcoin market.

What is USDC (USD Coin)?

Now that we’ve examined USDT, it’s time to examine USDC (USD Coin), a cryptocurrency launched by Circle and Coinbase in 2018 and tied to the U.S. dollar at a 1:1 ratio. Unlike USDT, which is created exclusively by Tether, USDC may be issued and redeemed by other CENTRE network members, such as Coinbase.

Commercial USDC issuers must meet regulatory, financial, technical, and operational norms. Issuers must back all USDC tokens with currency reserves and provide monthly proof of reserves to maintain one-to-one support.

TrueUSD (TUSD) vs US Dollar Coin (USDC)

The only stablecoins in the top 50 by market capitalization are Tether, TrueUSD, and USD Coin. With a market capitalization of over $1.7 billion, Tether is by far the most significant. TrueUSD, the closest rival, has a market valuation that is more than 10 times less, at around $160 million. Similarly, the freshly created USD coin has significantly more liquidity than the $140 million USDC token.

All currencies are built on the same principle: a centralized authority holds assets in a trust account and issues tokens indicating a 1:1 claim on those assets. Tether’s operations, holding company disclosures, accounts, and regulatory compliance are more transparent than USDC’s.

The revised stablecoin is issued as an ERC-20 token on Ether’s blockchain, improving compatibility with software, hardware wallets, exchanges, and other Ether-based applications. Most USDT is issued on the Omni blockchain, although certain ERC-20 tokens are included.

Tether has more transactions and users than TrueUSD and USDC. Tether’s circulation supply has been falling as TrueUSD and USDC have exploded.

Tether pairings are the most actively traded on the exchange. However, TrueUSD and USD Coin are still considered novices and are rapidly gaining popularity.

USDC and TUSD, which represent a significant share of the market capitalization of stablecoins, are perfect for investors wishing to test the waters of the stablecoin market. Learn more about other cryptocurrencies like IOTX and IOTA here:https://godex.io/versus/iotx-vs-iota.


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