In a joint statement, Jeremy Allaire, CEO of Circle, and Brian Armstrong, CEO of Coinbase, announced the dissolution of the Centre Consortium. Consequently, Circle will take exclusive charge of the issuance and governance of USDC. Additionally, Coinbase has acquired an equity stake in Circle while signaling a stronger commitment to stablecoins.
Circle, Coinbase Dissolve USDC’s Centre Consortium
On Monday, Coinbase and Circle unveiled significant news in a blog post penned by both CEOs. The duo shared that USDC will soon integrate with six additional blockchain networks, expanding its connectivity to a total of 15 chains.
Circle contends that a multi-chain future for USDC will more effectively serve individuals and businesses that utilize the stablecoin. Allaire elaborated on the announcement on the social media platform X. He explained that before the onset of global regulatory clarity, the Centre Consortium’s governance system was essential.
“Now, with regulatory clarity coming for stablecoins all around the world, including in the US, there’s no longer the need for such a structure,” Allaire commented. Circle will now have complete authority over the USDC initiative. The blog post emphasized that all direct accountability will now rest with Circle. The company will hold the smart contract keys, ensure regulatory compliance, and manage the reserves across multiple blockchain networks.
Both Allaire and the blog post highlighted that Coinbase has secured an equity stake in Circle, though the specific financial terms remain undisclosed. The companies also noted they’ve “reached an agreement” to further promote “stablecoins to the broader crypto economy.” Coinbase recently revealed that customers can now earn 4% rewards on USDC.
Currently, Circle’s USDC ranks as the second-largest stablecoin by market capitalization. While its market cap is considerably smaller than the leading stablecoin, USDT, it surpasses the third-largest, DAI, by a significant margin.
Conversely, USDC’s circulation has seen a sharp decrease over the last year. As of June 2022, the circulating supply stood at 55.87 billion USDC. Even so, by August 21, 2023, this figure has declined to approximately 25.98 billion, indicating that USDC’s supply has been reduced by a significant margin of over 53%.