USDC
USDC is a stablecoin pegged to the US dollar: 1 USDC aims to be worth $1. It is issued by the company Circle and backed by cash and short-term US government bonds.
How it works
It works like other fiat-backed stablecoins: the company mints USDC when it receives dollars and burns it on redemption. Circle regularly publishes reserve reports checked by an accounting firm. USDC launched in 2018 and runs on several networks, including Ethereum and a number of other blockchains.
People often choose USDC for its transparency and regulatory status: its issuer obtained authorisation in the EU under MiCA rules in 2024. That is why USDC is widely used in DeFi, by regulated platforms and in payment services.
The peg can still break. In March 2023 part of USDC's reserves sat in a failed US bank, and over a weekend the price fell to about $0.88 until it became clear the deposits would be returned. Like USDT, USDC on a specific address can be frozen by the issuer.
You hold 1,000 USDC. On a normal day you can swap them for about $1,000. At the peak of the March 2023 panic the market paid about $880 for them, but within days the price was back at $1. Anyone who panic-sold locked in a loss of about $120.
A mistake is treating USDC and USDT as the same thing and sending one to an address that expects the other. They are different coins from different companies, even though both trade around $1. Check both the ticker and the network before every transfer, and in a panic do not rush to sell a stablecoin below $1 before you understand why it dropped.
Questions and answers
What is USDC in simple terms?
It is a digital dollar from the company Circle: a token worth about $1, backed by cash and short-term US bonds.
What is the difference between USDC and USDT?
They have different issuers, reserves, reporting and availability by country. Both aim for $1, but the right choice depends on where you use them.
Can USDC lose its dollar peg?
It can, at least for a while: in March 2023 it fell below $0.90. The peg rests on the reserves and on trust in the issuer.
Related terms
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Updated: 2026-10-19