First published 13 April 2020. Expanded in October 2026 for the bank wobble, Circle’s listing, and the difference between native USDC and a bridged copy. USDC is a token that tries to stay near one US dollar. Circle issues it. You are holding Circle’s promise, written onto a blockchain, that a dollar’s worth of reserves sits behind each token and that permitted customers can redeem. You are not holding a dollar in your own bank account.
Stablecoins: useful, not magic is the category. What is Tether (USDT)? is the other large company dollar. They share a job. They do not share an issuer, a reserve, or a contract.
Where it came from
Circle and Coinbase launched USDC in September 2018 through a consortium they called Centre. Centre is no longer the name that matters. Circle is the issuer. Coinbase distributes it and, for years, shared in the reserve income. Those are company arrangements. They are not properties of Ethereum. USDC launches. A dollar token is still a company product is the week it started. Circle went public. USDC is still a company token is the later fact that a stock listing did not change the token into equity.
The original token is an ERC-20 on Ethereum. Circle has since issued USDC on other chains itself. A token that arrived on a chain through someone else’s bridge is a wrapped IOU for a USDC somewhere else. The logo can match. The contract does not. A deposit page that says “USDC” may mean the one Circle issued on that network, or a bridged copy the page forgot to distinguish. If the page names a contract, match it. If a send is large, send a test.
Reserves, and the weekend they were stuck
Circle says the reserves are cash and short-dated US government paper, and it publishes attestations. An attestation is a snapshot under an accountant’s scope. It is not a passbook with your name on it. In March 2023 a slice of those reserves sat at Silicon Valley Bank when the bank failed. USDC traded below a dollar for the weekend, because the market was pricing a reserve that could not be touched, not because Ethereum had stopped. USDC’s wobble was a banking story wearing a token’s ticker is that week. The price came back when the banking story did. The mechanism is the lesson: the peg is the balance sheet plus the market’s belief in it.
Circle can freeze addresses, the same shape of switch as Tether’s. A frozen USDC balance is still a company decision sitting on a public ledger. The GENIUS Act is a stablecoin statute. It is not MiCA, and it is not a dollar. Insurance that covers a bank where reserves are deposited is not insurance of the token in your wallet.
What USDC is not
It is not ETH, even when it sits in the same Ethereum address. It is not USDT. It is not Dai. What is Dai (DAI)? is a token minted against locked crypto, with a different way of breaking. It is not a yield. Any rate an app offers on USDC is that app’s product, with that app’s risk, stacked on top of Circle’s. DeFi is software with rules you cannot call support about.
Nothing here is an instruction to buy, redeem, or hold USDC. Read the issuer, the chain, and the contract. The ticker is the easy part, and it is the part that misleads.
