Along with the new investment, Circle also announced that it would create a new cryptocurrency pegged to the price of the USA dollar, which is meant to solve a key problem in digital currencies' use case: volatility.
Circle is developing USDC based on the open-source fiat Stablecoin framework developed by its own affiliate, CENTRE.
Bitmain will also join CENTRE in building USDC.
Backing USDC will be a new group called CENTRE that will provide independent oversight of USDC's development, promotion, stability and its guarantee of being tied to actual USA dollar reserves. Circle claims the partnership will help drive global interoperability that benefits consumers, business ventures, institutions, and marketplaces everywhere. Bitmain will be a partner in the effort; the plan is for the company to help Centre launch multiple fiat-backed cryptocurrencies, Circle said.
It is hard to use something like bitcoin if the volatility is so high. This new USDC will make digital tokens that much more appealing to the masses. It unlocks an incredible amount of power for the dollar.
In a blogpost, Allaire and Neville explained: "A price-stable currency, such as a token pegged to the USA dollar, is critical for enabling mainstream adoption of blockchain technology for payments as well as for supporting maturation in financial contracts built on smart contract platforms, such as tokenised securities, loans and property". According to the company, the invention of blockchain-based computing and cryptographic assets has brought in a new era of the 'open internet.' However, it adds that 'a price-stable medium of exchange and store of value is missing, ' which is needed for 'global financial interoperability to function reliably and consistently'.
Further, Circle claims they would be open to detailed and transparent financial & operational audits since they operate within the regulated framework of U.S. money transmission laws. "It is built on an open source framework with an open membership scheme that eligible Financial Institutions (FI) can participate in (Centre)".
Itself based on the Ethereum ERC-20 token standard, USDC will be available to anyone who has completed a KYC process.