April 29, 2021 |
James Messi
Beaxy Exchange launched a USDC to USD trading pair to broaden traders’ access to cryptocurrency markets. Trading directly between USD and USD-backed stablecoins reduces friction and the additional costs incurred when traders are forced to make multiple transactions to convert fiat currency into a stablecoin or vice versa.
What is USD Coin (USDC)?
USD Coin (USDC) is a widely used stablecoin that was co-founded by Circle and Coinbase. USDC was created to mimic the value of the United States dollar (USD). Some cryptocurrencies are referred to as ‘stablecoins’ because their price is meant to maintain parity, or stability, with another asset. In the case of USDC, the digital asset is backed by an equivalent amount of USD. This allows USDC to maintain a price level at or near $1.
At the time of writing, there are 11.2 billion USDC tokens in circulation. This implies that there are also 11.2 billion USD held in reserve to backup the value of USDC tokens. To ensure that the USD reserves being held are adequate to keep the value of every USDC token at $1, independent auditors periodically verify the USD balances being held by Centre, the consortium that manages the USDC token. To actively maintain the value of USDC, new tokens are issued as USD enters the reserves and existing tokens can be burned if the reserves are low.
The Benefits of Directly Converting Between Fiat to Stablecoins
As the 2020-2021 cryptocurrency bull run continues, adoption and use of USDC continues to grow. In Q4 of 2020, USDC was used to generate roughly $500 million in daily average volume. Now, in Q2 of 2021, the daily average USDC volume is north of $1.5 billion.
The large growth in volume can be partially attributed to the overall rise in USD values for most cryptocurrencies. USDC volume growth can also be attributed to a general increase in USDC usage.
Fiat currency is still the primary asset that cryptocurrency traders prefer to ‘cash out’ in. Meaning that fiat currencies are used as a portal to bring people in and out of cryptocurrency.
Cryptocurrency traders often find that the digital asset they want to acquire is not available on the exchange they hold fiat currency on. In this case, funds need to be sent from that exchange to the platform that lists the asset you want to buy. There are virtually no methods to send fiat currency directly from one exchange to another. On the other hand, cryptocurrency can easily be sent from one exchange to another but most digital assets are volatile, even in short time frames.
This is where stablecoins come into play. By converting your fiat currency into USDC, you can protect the USD value of your holdings while they are in transit from one exchange to another. That sounds easy enough, but most exchanges don’t list a trading pair that enables traders to exchange fiat currencies and stablecoins directly.
With Beaxy’s USDC to USD trading pair, USD that is onboarded can be converted to an equivalent value in USDC in one step. That USDC, which is compatible with multiple blockchains (Ethereum ERC20, Binance Smart Chain BEP20, Binance Chain BEP2, Solana SPL) can then be used seamlessly throughout the world of cryptocurrency.
Conversely, for traders looking to take the final steps to cash out on some of their cryptocurrency holdings, Beaxy’s USDC to USD trading pair enables them to move into fiat with one transaction. Reducing the overall cost and time it takes to convert a cryptocurrency position into cash in your bank account.
Convert Fiat to USDC Today
Trading in and out of fiat currencies has never been easier. Seamlessly move between USD and the most popular stablecoins when you sign up on Beaxy Exchange. Create your account today to buy, sell, or trade USDC on a secure exchange with low fees.
On average, Beaxy Exchange applicants complete KYC in less than five minutes. The digital assets held on Beaxy are secured by Curv custody, and your USD holdings are backed by FDIC insurance up to $250,000 per account.
Creating an account on Beaxy Exchange gives you access to:
- Buy, sell, or trade dozens of popular cryptocurrencies
- Move funds in and out of six national currencies (USD, EUR, GBP, JPY, CAD, AUD)
- Access revolutionary trading tools like Trender and Signals
- Become an algorithmic trader with Gunbot, Hummingbot, Autonio, and more
- Double your stack when you opt-in to the Deposit Bonus program
