The issuer of the stablecoin USDC, Circle Network Financial, and cryptocurrency exchange Binance have announced that, as part of an accelerated growth plan, the two companies are collaborating to expand the use of this stablecoin on the Binance platform.
Binance will list more cryptocurrency trading pairs priced in USDC and offer special promotional activities related to USDC. According to a statement, Binance also plans to hold USDC as part of its corporate funds. A spokesperson for Binance declined to disclose how much USDC the company would hold, adding that their goal is to 'gradually' increase their holdings of this stablecoin over time.
This expanded partnership comes as Circle's main competitor, Tether, has increased its dominance in the market share of USDT tokens during the current cryptocurrency rally. Meanwhile, Binance reached a $4 billion settlement with the U.S. last year over a series of allegations of violating anti-money laundering and sanctions laws, and is currently seeking to solidify its market leadership.
'Binance has undergone a profound business transformation, and over time, we collectively believe that it makes sense to combine the world's most trusted and regulated stablecoin, USDC, with the world's largest cryptocurrency exchange while prioritizing the safety of customer assets,' said Circle's Chief Business Officer, Kash Razzaghi.
Stablecoins are digital assets designed to maintain a stable value, in stark contrast to the price volatility of Bitcoin and other cryptocurrencies. They are typically pegged to another currency, most commonly the US dollar. They are also increasingly used for cross-border transactions between non-crypto companies.
Over the past year, interest in the industry has increased as stablecoins provide cheaper and faster solutions for some conventional banking payment channels. According to tracking agency CoinGecko, the entire stablecoin market has ballooned to over $204 billion. Tether's USDT circulation is approximately $139 billion, while Circle's USDC circulation is about $41 billion.
Razzaghi stated that Circle's focus on compliance and transparency will give the company 'incredible competitiveness' in addressing Tether's market dominance.
A spokesperson for Binance stated that the company will continue to 'collaborate with multiple stablecoin issuers or creators,' with specific decisions depending on user demand.
