As the second most used stablecoin behind Tether, USDC continues to grow in popularity, largely due to the many use cases and benefits it provides.
While it’s incredibly easy to buy USDC, USDC is also practical for a variety of purposes as well. In today’s article we’ll take a look at 6 of its use cases.
1. Easier access to crypto markets
Using USDC allows you to buy, sell, and transfer funds while remaining in the cryptocurrency ecosystem. Instead of having to cash out to your traditional bank, you can hold USDC which is pegged to the US dollar. USDC is accepted on virtually every major cryptocurrency exchange, both centralized and decentralized, giving you plenty of options for where to hold or invest your money.
2. Cross border payments
Transferring your local fiat currency to other businesses or individuals around the world is incredibly costly, not to mention inconvenient. Some bank payments can take days to process, on top of hefty fees. With USDC, you’re able to send to anyone with a cryptocurrency wallet and for a literal fraction of the cost.
As Coinbase notes: “Two Ethereum wallets can quickly send and receive any amount of USDC at any time of day. Large transfers for business purposes become as easy as small e-commerce payments. Consumers can use the Coinbase app to send USDC to someone, while remaining confident the value is stable.” Furthermore, many other blockchains such as Solana, Binance Smart Chain, Stellar and Algorand also support USDC.
3. Pay your employees in crypto
Another useful benefit of USDC is that it can help make it easier to pay employees in crypto. While far from a mainstream request currently, many professional athletes and startup employees are beginning to request to be paid in cryptocurrency.
While being paid in Bitcoin and Ethereum can certainly have upside, the volatility in price makes it a difficult option to consider for many. Using USDC, employees can get paid in crypto while being protected against the downside of price swings. Additionally, with USDC users can then purchase the cryptocurrency of their choice with ease.
4. Earn with USDC
Like with traditional savings accounts, you can also earn interest with your USDC by lending your tokens on a variety of platforms. While interest rates change on a regular basis, in most cases you can earn more lending USDC than you would with a traditional savings account. Additionally, it’s easier to choose where to invest your money compared to being stuck with your standard bank.
5. Governmental aid
USDC and other stablecoins are also seeing more use in the case of government policy as well. Given the ability to easily transfer to individuals and businesses who have access to the internet, USDC makes it easier for governments to transfer relief funds or even financial aid.
In the case of Venezuela, Zerocap explains the appeal of USDC:
“So why are stablecoins better for the task? The population uses mobile crypto wallets, which the government has no sovereignty to access. Although they can monitor transactions, it is quite challenging to identify the citizen behind their usage without a proper KYC procedure. Venezuelans are no strangers to digital currencies; the current crisis is booming crypto use for not only humanitarian aid from independent organisations, but as a hedge against the country’s frenetic inflation rates.
6. Increasingly embraced by legacy financial institutions
While traditional financial institutions may have been slow to adopt a new world of crypto and blockchain technologies, many of the world's largest banks and finance players are finally beginning to take note and working to continue to lead the innovation.
While USDC offers its users lower transaction fees and can be sent or received anywhere virtually instantly, it was also developed by playing nicely with traditional finance and governmental regulations in mind.
As Centre, shares:
“USDC solves these problems by offering a solution with detailed financial and operational transparency, operating within the regulated framework of US money transmission laws, with established banking partners and auditors, and is built on an open source framework with an open membership scheme that eligible financial institutions can participate in.”
In many ways the increased adoption of cryptocurrency will transform our current financial system, but it is not a zero sum game.
Given USDC and stablecoins as a whole are still a relatively young technology, there are many more use cases that will continue to develop over time. We hope this article gave you a little insight into the many ways you can use USDC.