Cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) demand most of the attention within the crypto space, and for good reason: these two leading tokenscoins alone account for a combined 72% market dominance.
By Corey Barchat
Published on Jul 26, 2024
Last modified on Oct 23, 2025
Cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) demand most of the attention within the crypto space, and for good reason: these two leading coins alone account for well over half of the total value of the crypto market.
But there are hundreds more cryptocurrencies and blockchain projects. And though most people choose to invest in BTC or ETH, one concern with the largest cryptocurrencies is the often considerable price volatility.
Price volatility is nothing new, however, and has been commonplace since the birth of crypto. For seasoned investors and crypto newbies alike, wild fluctuations in price can represent an opportunity for big returns. But for some they might make cryptocurrency assets seem too risky because of potential losses.
Stablecoins were created as a digital asset attempting to maintain a stable price that presented an alternative to other more volatile cryptocurrencies.
This article explains this type of digital currency and looks at USDC, the second-largest stablecoin on the market today: how it works, what changed for it in 2025 and 2026, whether it has ever lost its peg, which wallets and networks hold it, and how to buy it.
USDC is a dollar stablecoin issued by Circle. Originally called USD Coin and launched in 2018 by Circle and Coinbase, it attempts to maintain a constant value relative to the US dollar, though it has once briefly lost its peg. USDC began as an ERC-20 token on the Ethereum blockchain and is now issued natively on more than 20 networks.
After being managed by the Centre Consortium for most of its early life, Centre announced in 2023 that it would be shutting down.
As a result, Coinbase took an equity stake in Circle, which became the sole issuer of USDC and governs the technical and financial standards for the stablecoin. Circle aims to provide transparency around a 1-to-1 backing of USDC. This means that for every USDC created, there should be $1 USD worth of assets held in reserve.
As of the second quarter of 2026, Circle reported $73.3 billion of USDC in circulation, up 19% on the year. The token can be bought and sold on a variety of cryptocurrency exchanges and cryptocurrency providers, including via MoonPay by using a credit card, and you can follow the USDC price and supply on MoonPay.
You can also transfer USDC across the world with any Ethereum wallet or crypto exchange that is ERC-20 compatible. But it's not limited to the Ethereum network: Circle issues USDC natively on other major blockchain networks such as Solana (SOL), Base, Arbitrum, Polygon, Avalanche, Stellar (XLM), Algorand (ALGO), Sui and Aptos.
Stablecoins are a specific subset of cryptocurrencies which aim to peg their value to the value of a real-world asset (usually fiat) to ensure price stability. With many types of stablecoins in existence, there are several different methods used to attempt to maintain a stable value.
One common method is for a stablecoin issuer to maintain a reserve of assets. For example, in the case of USDC, for every one coin in existence, there should be one dollar of corresponding assets held in reserve.
The intention behind this is that the supply of USDC should be directly correlated with an equivalent amount of USD held in reserve backing USDC. Other stablecoins can be backed by crypto, additional commodity assets, or other fiat currencies besides the US dollar.
So how does USDC work on a technical level, given it is both a stablecoin and a cryptocurrency?
Essentially, whenever a dollar is deposited, a USDC token is created. Then, when a customer wishes to redeem USDC back for dollars, the tokens are permanently destroyed with a view to keeping a consistent backing.
Here's how the company responsible for USDC explains the technical process.
Redemption follows the reverse sequence: a customer requests a redemption from an issuer, and upon successful verification and validation, the appropriate USDC tokens are irrevocably deleted from circulation ("burned"), and funds from underlying reserves are transferred back to the customer's external bank.
For stablecoins like USDC to operate as intended, there needs to be trust and transparency from the overseeing parties to ensure that there is actually a 1-to-1 backing. Circle holds the reserves as cash and short-dated US Treasuries, most of it in the Circle Reserve Fund, a government money market fund managed by BlackRock, with the cash portion at large, systemically important banks. It publishes the composition monthly with an attestation from the accounting firm Deloitte, which took over from Grant Thornton in 2023, and posts routine updates on its transparency page.
The entire concept of fiat-backed stablecoins is premised on there being a 1-to-1 backing of fiat assets to stablecoins, which is why the USDC issuer strives for transparency.
USDC had its biggest two years since launch, and most of the change was structural rather than about price, which by design does not move.
Circle went public. Circle listed on the New York Stock Exchange under CRCL in June 2025, which put its reserves and reserve income into quarterly filings. As of the second quarter of 2026, Circle reported $73.3 billion of USDC in circulation, up 19% on the year, and $14.8 trillion of on-chain USDC transaction volume in the quarter.
The US got a stablecoin law. The GENIUS Act, signed July 18, 2025, requires US-issued payment stablecoins to hold 100% reserves in cash and short-term Treasuries, publish reserve reports, follow bank-style anti-money-laundering rules and refrain from paying interest to holders for simply holding the coin. USDC's structure already looked like that, which is why Circle spent 2025 positioning USDC as the coin that would need the least change. The implementing rules were still in draft in August 2026, with the OCC expecting to finalize its rule late in 2026.
Europe authorized it. USDC and Circle's euro coin EURC are authorized under MiCA, the EU's crypto framework, so EU exchanges kept them listed while delisting USDT in early 2025.
It became native on more than 20 chains. Circle issues USDC directly on more than 20 networks, and its Cross-Chain Transfer Protocol (CCTP) moves the coin between them by burning it on one chain and minting it on another, with no wrapped token and no third-party bridge. CCTP V2, released in March 2025, cut transfer times to under half a minute on supported routes. Circle's Gateway product lets apps show a single USDC balance across chains.
Circle is building its own chain. Arc, an EVM-compatible network designed for settlement between institutions, ran as a public testnet through 2026 with a mainnet launch scheduled for September 16, 2026.
Once, and briefly. On March 10, 2023, Silicon Valley Bank failed while holding about $3.3 billion of USDC's cash reserves, roughly 8% of the total at the time. Over the weekend USDC traded as low as about $0.87 on some exchanges as holders sold rather than wait to learn whether the money was recoverable. On March 12 the US Treasury, Federal Reserve and FDIC announced that all SVB depositors would be made whole, and USDC was back at a dollar by March 13.
The episode changed two things. Circle, which had launched the BlackRock-managed Circle Reserve Fund a few months earlier, moved the cash portion of its reserves to large, systemically important banks, and it publishes the composition monthly with a Deloitte attestation. And it made the point that a fiat-backed stablecoin is only as safe as the banks holding its cash, which is one of the problems the GENIUS Act's reserve rules are meant to reduce.
USDC has not traded meaningfully off its peg since.
So what can USDC actually be used for? Given its status as a fiat-backed stablecoin that is less volatile than other digital assets, USDC can be used in unique ways compared to other cryptocurrencies.
USDC allows you to buy, sell, and transfer funds while remaining in the cryptocurrency ecosystem. Instead of going through many steps to cash out to your traditional bank or card, you can swap crypto to USDC. USDC is accepted on virtually every major cryptocurrency exchange, both centralized and decentralized, giving users plenty of custodial options.
Transferring your local fiat currency to other businesses or individuals around the world can be 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 make cross-border payments, also known as remittances, to anyone with a cryptocurrency wallet for just a fraction of the cost of traditional remittances.
Another useful benefit of USDC is that it can help make it easier to pay employees in crypto. While far from being a common request, professional athletes and startup employees are beginning to negotiate 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 potentially being protected against the downside of price swings. With USDC users can then purchase the cryptocurrency of their choice with ease.
Stablecoins like USDC are a common choice to use in decentralized finance (DeFi) and its many applications.
For example, USDC can be used to provide liquidity in pools to earn rewards in the form of LP tokens that generate interest when other users participate in the pool. Let's say you own both USDC and Ethereum, and want to earn interest on your holdings via yield farming. You could provide equal amounts of USDC and ETH in a liquidity pool, to earn a percentage of transaction fees when others swap between that pair.
Of course, there are always risks involved in participating in DeFi, such as smart contract hacks and impermanent loss, which is when the price of one token pair in a liquidity pool fluctuates in comparison to the other when a user withdraws their liquidity.
Did you know? You can use USDC (SOL) on MoonPay to participate in DeFi trading for thousands of SPL tokens available across major Solana decentralized exchanges (DEXs). Just top up on USDC (SOL) in your MoonPay Account to start trading in seconds and with low fees.
USDC and other stablecoins are also seeing more usage in the case of government policy as well. Given its ability to transfer to individuals and businesses who have access to the internet, USDC makes it easier for governments to transfer relief funds.
It also facilitates international donations, bypassing the roadblocks that accompany transfers between banks in different countries.
The uses have spread well beyond trading.
Payments and payouts. Businesses use USDC to pay contractors and suppliers abroad, because it settles in minutes on a weekend for a few cents. MoonPay's business products use stablecoins including USDC for pay-ins, conversion and payouts.
Treasury. Companies hold USDC as a dollar balance that moves at internet speed, and Circle's own reserve income shows how much money is parked this way.
Trading. USDC is the quote currency on Base, most of Solana's decentralized exchanges and a growing share of centralized exchange volume. Its share of US exchange trading rose from about 18% to 26% between January and August 2026 as USDT's fell.
AI agents. Payment protocols built for software agents, such as the x402 standard, settle in USDC because an agent can hold and spend it without a bank account. Our agentic payments article covers this in more detail.
By transaction volume, USDC processed about $18.3 trillion on-chain in 2025 against USDT's $13.3 trillion, even though USDT has more than twice the supply, according to Artemis data reported by Bloomberg.
Any wallet that supports a chain where USDC is native can hold USDC on that chain. The thing to understand is that USDC on Ethereum, USDC on Solana and USDC on Base are three different tokens issued by the same company, and a wallet address on one network cannot receive the version from another.
Some wallets make this simple. Phantom shows one Solana address that receives SOL and every Solana token including USDC, with separate addresses for Ethereum and Base. MetaMask uses one address for every EVM chain, so USDC sent on Base and USDC sent on Arbitrum both arrive at the same address but show up only when you switch to that network. Ledger and Trust Wallet ask you to choose the network when you receive.
When you buy USDC, the checkout asks which network you want. MoonPay offers USDC on several networks at checkout, and the right answer is whatever your receiving wallet or app lists. When you are moving USDC between chains yourself, CCTP-based transfers inside wallets and apps give you native USDC on the other side; older bridges may give you a wrapped version (often labeled USDC.e) that is not the same token.
USDC has some intrinsic benefits that make it appealing to users over other crypto tokens:
Instead of holding a cryptocurrency that fluctuates wildly, investors can swap to a potentially less volatile asset like USDC.
For those trying to time the top of the market and buy back in later, USDC can be held until the time comes to swap back to a more volatile cryptocurrency of your choice.
USDC can be lent on DeFi platforms or deposited in liquidity pools to earn a return, and it can be used in trading pairs to earn a percentage of network fees. Circle itself does not pay interest for holding USDC, and under the GENIUS Act US issuers are not allowed to; any yield comes from a third-party platform and carries that platform's risks.
You can quickly and cheaply send your USDC to a variety of blockchain ecosystems like Ethereum, Solana and Base, and then use it to purchase a variety of cryptocurrencies and NFTs. Because Circle issues it natively on each chain, you rarely need a bridge.
Circle consistently publishes attested monthly reports of its reserves held in the Circle Reserve Fund and at its banks, is regulated by the New York Department of Financial Services and authorized under MiCA, and is generally seen as a trusted issuer of the stablecoin.
Despite its advantages, USDC also carries some inherent limitations and risks:
Although stablecoins like USDC are meant to hold a stable price and 1:1 backing with their reserves, USDC lost its peg for three days in March 2023, and there is no guarantee this will not happen again in the future.
Due to its stable value, USDC lacks the price appreciation that investors come to expect from other cryptocurrencies. However, this limited upside is offset by DeFi functionality such as lending, liquidity pools, and yield farming.
USDC is not the only stablecoin, and ranks second in market cap among stablecoins pegged to the dollar. USDT (Tether) holds the top spot with roughly 59% of the stablecoin market against USDC's 23%, according to DefiLlama, so its market cap is about two and a half times larger. Tether was released with a four-year head start, and USDT still has the most trading pairs on the most exchanges, while USDC leads on regulation, on-chain transaction volume and native chain coverage.
Under Europe's MiCA (Markets in Crypto-Assets) framework, only authorized stablecoins can operate freely across the EU. USDC has MiCA authorization, while USDT does not, which is why USDC is the preferred option for European platforms. For a full comparison, see our article USDT vs USDC: which stablecoin should you use?
As with any investment or cryptocurrency purchase, you should always do your own research. It's also important to buy only from trusted exchanges and services, and store your crypto in the right wallet.
That being said, stablecoins like USDC are not immune to the risk factors that affect all digital assets and cryptocurrency investments. Even though the price of stablecoins is intended to remain stable, these assets have experienced depegs, hacks, and even total collapse.
Even though Circle releases regular attestations of its reserves, there is no guarantee that the coin will always maintain its $1 value.
Dollar-denominated assets like USDC open up possibilities for investors inside the United States and around the world. It can be sent anywhere at any time and used to stay within the crypto ecosystem without cashing out to fiat.
MoonPay Balance is an easier way to purchase USDC using fiat currency. Begin by funding your wallet with euros, pounds, or dollars and use your MoonPay Balance to purchase stablecoins like USDC. With MoonPay Balance, you'll enjoy faster transactions, lower fees, and higher approval rates. Plus, when it's time to cash out, take advantage of zero-fee withdrawals straight to your bank account.
There is no guarantee that USDC will always hold its intended value of $1. As we have seen, USDC has experienced depegging (in both directions, including its fall to about $0.87 in March 2023), so users should be aware of potential depegs in the future.
At the same time, Circle regularly publishes reports of its backed reserves with monthly attestations from Deloitte, with the intention of demonstrating that there is an equivalent value of USDC reserves and circulating supply.
Yes. Circle is regulated as a money transmitter in the US and holds a New York Department of Financial Services license for USDC, Circle's French entity is authorized under MiCA in the EU, and Circle applied to the OCC for a national trust bank charter in 2025 and is positioning USDC for permitted-issuer status under the GENIUS Act as the rules are finalized.
Circle issues USDC natively on more than 20 blockchains, including Ethereum, Solana, Base, Arbitrum, Polygon, Avalanche, Stellar, Algorand, Sui and Aptos. Each version is a separate token, so always send USDC on the network your recipient lists.
Although it is one of the most widely used stablecoins, USDC is not the only one in existence. Stablecoins can be pegged to any asset, and other national currencies such as the Brazilian Real (BRL).
There are also many other dollar-backed stablecoins, such as USDT (Tether), Dai (DAI), PayPal USD (PYUSD), USD1 and RLUSD. Our stablecoin list covers 31 of them.
For a more detailed comparison of the two largest, see our article USDT vs USDC: which stablecoin should you use?
Like the fiat currency it's pegged to, USDC is divisible to the cent. It's actually even more divisible than the dollar and transactions can be sent for as low as 0.000001 USDC.
You can buy USDC via MoonPay or through any of our partner wallet applications with a credit card, bank transfer, Apple Pay, Google Pay, and many other payment methods.
MoonPay also makes it easy to sell USDC when you decide it's time to cash out. Simply enter the amount of USDC you'd like to sell and enter the details where you want to receive your funds.
Want to exchange USDC for other cryptocurrencies like Ethereum and Bitcoin? MoonPay allows you to swap crypto cross-chain with competitive rates, directly from your non-custodial wallet.
You can also instantly swap USDC (SOL) for any supported Solana token like SOL, BONK, RAY, JUP, TRUMP, and much more, right in your MoonPay Account.
