U-Turn: Centre to Convert USDC Reserves to Cash and US Treasuries
2021-09-03 23:51:19 Primitive Reading

 

Centre, the issuer of popular stablecoin USDC, has revealed that it will convert the asset reserves back to cash and U.S. treasury bills only.

In an official blog post on Monday, the Centre Consortium noted that it now intends to “hold the USDC reserve entirely in cash and short duration US Treasuries.”

The organization said the decision was prompted by its commitment to increasing transparency and exploring new opportunities to collaborate with the USDC community. It noted that the new changes will be promptly implemented and “will be reflected in future attestations” by its auditing firm, Grant Thornton.

Centre Makes U-turn

Recall that last month, the company revealed in an attestation report for May published by Grant Thornton that it has expanded its investment portfolio for the USDC reserves, worth about $22.2 billion at that time. 

Grant Thornton gave a well-detailed breakdown of the expansion in the paper. The auditing firm noted that Centre held $13.4 billion (61%) of USDC reserves in cash and cash equivalents and $2.7 billion (12%) in U.S. Treasuries.

In addition to this, the stablecoin issuer expanded the reserves portfolio to include $2.9 billion (13%) Yankee Certificate of Deposit, $2 billion (9%) Commercial Paper, $1.1 billion (5%) Corporate Bonds, and $100 million (0.1%) Municipal Bonds & US Agencies.

Coinbase Refutes USDC Reserve Claim

Meanwhile, earlier this month, Coinbase, one of the official backers of the USDC stablecoin, walked back on its previous claims that the stablecoin was backed by the US dollar, refuting its initial claim.

Coinbase had even gone as far as changing the description for USDC on its official website from “backed by one US dollar,” “held in a bank account,” to “backed by one dollar or asset with equivalent fair value.”

The expansion of the reserve portfolio to contain those other assets did not sit well with USDC users and partners. The reason being that those assets could suffer massive losses. And since they are less liquid than cash, it could cause a lot of trouble if users ever tried to redeem the stablecoin en masse.

The conversion of the USDC reserves back to cash and U.S. Treasuries will take effect immediately and “will not extend past September,” according to a tweet from Coinbase’s COO, Emily Choi.

Disclaimer: This specification is preliminary and is subject to change at any time without notice. Amazon Finance assumes no responsibility for any errors contained herein.

Recommended reading
PSG SUPER GUILD’s Ibrahim “Fudge” Allami will be the first Oceanic export to make an international event at MSI 2021

10-22     Amazon Finance     200 Reading

Rise of the GameFi Circuit, DRT Games Set Foot on the Journey to Break the Circle

10-22     Amazon Finance     113 Reading

NFT Lab and R3 Blockchain Alliance reached a strategic cooperation Jointly promote the development and construction of the NFTT platform

10-22     Amazon Finance     163 Reading

YGG joins hands with FTN-LEA to build a global chain tour guild (DAO) system and create a global chain tour guild benchmark!

10-22     Amazon Finance     163 Reading

Encrypted Habitat, Digital Twins| NFT-BluSea Forum Ends Successfully

10-22     Amazon Finance     171 Reading

Ecology Blockchain: Boost Traditional Enterprises in Accessing to the Decentralized Business Ecology

10-22     Amazon Finance     102 Reading

X10 Legends Jointly Held Online Launch Meetings in Many Places Around the World.

10-22     Amazon Finance     145 Reading

Ecology Blockchain: Pacemaker of Ecological Application, Creating the Strongest Consensus of Blockchain Ecological Application

10-22     Amazon Finance     181 Reading

Blockchain technology enters the business world and NEMANJA will keep focusing on the technology

10-22     Amazon Finance     62 Reading

A new generation of fully decentralized exchanges, Node Swap, is coming online

10-22     Amazon Finance     202 Reading

NEMANJA Global cooperated with several enterprises to start the road of global development

10-22     Amazon Finance     92 Reading

FTN-DEX decentralized trading platform enters into a strategic partnership with Canadian foundation Oasis

10-22     Amazon Finance     95 Reading

200 FWNFT sold out in 11 minutes, the fifth phase of sale will start on October 10

10-22     Amazon Finance     173 Reading

The phase Ⅲ of FWNFT was sold out, with a total subscription of 211.8 million USDT

10-22     Amazon Finance     67 Reading

FWNFT phase II was available for sale today and 400 FWNFT tokens were sold out in 9 minutes

10-22     Amazon Finance     103 Reading