Binance Cannot Stop USDC, The Stablecoin Spreads to 5 More Networks
The recent announcement of Binance that it will stop supporting USDC on its platform was a huge hit to USDC which tanked about 10% in market evaluation after the announcement. USDC is the second-biggest stablecoin pegged by the US dollar. It has an impressive $50.4 billion in circulation and proven US reserves to back the liquidity. USDT, the main competitor of USDC and the leading stablecoin, has $70 billion in circulation.
Tether faces problems with audits, USDC may overtake
Tether has been dealing with its demons. The current class-action lawsuit filed against the corporation is leading to a very worrying situation for the company since it will have to reveal its books to the court that issued an order demanding the company to comply and produce documents that show the cash flow, reserves, and bookkeeping. As long as Tether can hold off the judges, USDT should stay stable and reliable.
However, it is possible that USDT has some shady stuff behind it and documents will reveal insufficient backing which can lead to runoff and a market crash. If the crypto industry wants to survive this worst-case scenario, we need plan B. It seems that USDC is willing to play this role by expanding its presence in the industry.
Binance decided that it will drop USDC, but many networks are picking it up guaranteeing a strong case for recovery. The stablecoin will expand to Arbitrum, NEAR, Polkadot, Optimism, and Cosmos. The expansion should provide flexibility, safety, and interoperability to users of this stablecoin. Many analysts are already predicting that the USD-pegged token will see more use.
We cannot let another Terra Luna happen!
One of the reasons why many crypto enthusiasts are so excited about this expansion of USDC is that we all want more safety which will be, in theory, provided by this move. On the other hand, the current lawsuit involving Tether brings nothing but anxiety. We cannot afford another crash Terra-Luna-style, not amidst the crypto winter that threatens the whole crypto industry with long-term recessions and adoption delays.