ICYMI is an ongoing series of blog posts commemorating important Twitter threads from thought leaders at Coinbase and beyond. In this thread on 08/22/2021, Coinbase COO and President Emilie Choi clarifies the situation around USDC reserves.
Quick update on USDC. Beginning in September 2021, USDC reserves will be held in cash and short-lived US Treasuries. This It is the approach we want for USDC reserves.
The USDC has always been fully backed by reserves equal to or greater than the USDC in circulation, giving users the ability to always exchange 1 USD coin for USD 1.00.
We know that many clients get USDC on Coinbase, and we previously said that each USDC is “backed by a dollar in a bank account.” Our language could have been clearer here.
When Circle shared its May report on USDC reserves in late July (which included a more diversified investment pool for the first time), we should have moved faster to update statements like that on our website. That was a mistake and Coinbase takes care of that.
In any case, the investment portfolio changes for USDC reserves began in May 2021 and will not extend beyond September.
Center, together with Circle, will ensure that investments in USDC return to a more conservative investment profile by the end of September.
So to be clear, the next 2 certification reports (June and July) for USDC reserves will show a diversified investment portfolio. This will be reversed as of August.
We are excited about the continued growth and adoption of USDC, which has become the world’s largest regulated stablecoin, with a market capitalization of nearly $ 28 billion.
* We have added links where appropriate. You can see original thread here.