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Coinbase is launching support for the USDC stablecoin

blog.coinbase.com

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Re: Coinbase is launching support for the USDC stablecoin

#311

Post by hndamien »

Permit wrote: post #11

Stablecoins seem like they would achieve most of the goals of the original cryptocurrencies such as Bitcoin: - Decentralized transactions - 24/7 access - Low fees - Store of value I suppose the only drawback here is that they're issued from a centralized authority. That said, for practical purposes the vast majority of Bitcoin holders didn't mine their own coins either. Despite this, no one on Twitter[1] seemed excit…

The main thing that it doesn't address is you need to trust a central authority (as you mentioned) and it is pegged to an inflationary money.

Re: Coinbase is launching support for the USDC stablecoin

#312

Post by hndamien »

asynchrony wrote: post #283
deevolution wrote: post #273

Earlier quoted context omitted.

How do you fix our current monetary system??? You cant... its also generally much easier to make change by starting from scratch rather than trying to move an entire establishment. If the innovation catches on, the old establishement will crumble.

Your premise is to "fix" the monetary system, but you failed to articulate the issues that you want to resolve.

Currency debasement.

Re: Coinbase is launching support for the USDC stablecoin

#313

Post by hndamien »

wcoenen wrote: post #163
gwbas1c wrote: post #77

Earlier quoted context omitted.

> Despite this, no one on Twitter[1] seemed excited Because most people think that in order to solve the problem of a cryptocurrency, they have to also solve the problem of who gets money when you print it. Far too many people conflate the need for electronic cash versus the need to improve upon how systems like the Federal Reserve and their International equivalents work. Honestly, as a software engineer who underst…

> I think cryptocurrency becomes far more interesting when it's not trying to solve the problem of who gets money when it's printed This was not the goal of bitcoin. The goal was to remove the need for trusted intermediaries from electronic payments. https://bitcoin.org/bitcoin.pdf

Thats true, but in order to make that work it actually needed to solve both problems.

Re: Coinbase is launching support for the USDC stablecoin

#314

Post by JumpCrisscross »

beaner wrote: post #300
JumpCrisscross wrote: post #258

Earlier quoted context omitted.

> That modern economics has programmed in accountability for slow, large payments doesn't mean the system wouldn't be better off if it changed It's more fundamental than accounting. If a transaction costs X, aggregating N transactions into a single transaction reduces the per-transaction cost to X/N. The latter, batched process will always be slower and cheaper than the former. (If a transaction costs Y%, aggregating…

Payments are generally batched because individual payments are slow and/or have restrictions applied, like time of day they can be sent or received, which are easier to reason about when aggregated. If you remove these burdens by having a technology that is cheap and nearly instant for all payments, then there's no real need to batch. We're not quite at cheap + instant with crypto, but there's nothing preventing it i…

> Payments are generally batched because individual payments are slow

They're slow to enable batching. Fedwire is time-limited, but many other real-time payment networks are not.

> If you remove these burdens by having a technology that is cheap and nearly instant for all payments, then there's no real need to batch

Yes, there is. To make payments even cheaper. For any given transaction price and speed pair, there's a market that cares more about price than speed. You'll always be able to layer a net settlement layer on top of an RTGS network to serve that market at lower cost.

In any case, if we're arguing for RTGS, it will always be faster and cheaper to transfer money via database operations than on a blockchain. Fast and cheap are not–and should never have been–cryptocurrencies' selling points.

Re: Coinbase is launching support for the USDC stablecoin

#315

Post by stephen_g »

VMG wrote: post #47
Permit wrote: post #11

Stablecoins seem like they would achieve most of the goals of the original cryptocurrencies such as Bitcoin: - Decentralized transactions - 24/7 access - Low fees - Store of value I suppose the only drawback here is that they're issued from a centralized authority. That said, for practical purposes the vast majority of Bitcoin holders didn't mine their own coins either. Despite this, no one on Twitter[1] seemed excit…

The tokens only have value as long as your tokens are redeemable. Multiple things can make them non-redeemable: * Your tokens can be tainted, for instance because they were once owned by a blacklisted address. The value of your tokens will be effectively 0. * The issuer might run a fractional reserve (this is the accusation against Tether, the most popular stablecoin at the moment) * The asset backing the stablecoin…

> The issuer might run a fractional reserve (this is the accusation against Tether, the most popular stablecoin at the moment)

Very important to note - a stablecoin running a "fractional reserve" in the way that people talk about would just be fraudulent/insolvent.

Modern banks have actually never operated under the "fractional reserve" model as described in economics textbooks, but it's true that they only a fraction of their assets are held as bank reserves. Very importantly though, solvent banks always have more assets than liabilities (customer deposits are a liability to the bank). Usually a lot of those assets are loans, but they also hold bonds and other investments.

If Tether has issued a single token without an asset to back it that is worth at least US$1, then that's not operating like a bank does, it's just fraud.

Re: Coinbase is launching support for the USDC stablecoin

#316

Post by stephen_g »

Geee wrote: post #141
VMG wrote: post #47

Earlier quoted context omitted.

The tokens only have value as long as your tokens are redeemable. Multiple things can make them non-redeemable: * Your tokens can be tainted, for instance because they were once owned by a blacklisted address. The value of your tokens will be effectively 0. * The issuer might run a fractional reserve (this is the accusation against Tether, the most popular stablecoin at the moment) * The asset backing the stablecoin…

Doesn't every bank run a fractional reserve? So when Coinbase deposits those reserves in a bank, the bank will lend them and there actually isn't a guaranteed reserve.

Banks only hold some of their assets as central bank reserves, but solvent banks always have more assets than liabilities.

For a stablecoin to operate like a bank they would have to issue loans (loans are an asset to the bank to match the deposit created when they lend. A regulated bank also needs a certain percentage of owner's capital (paid up shares/retained profits) compared to how much they lend in case of delinquent loans).

A stablecoin just creating tokens with no backing would be fraud, same as if a bank just credited an account from nothing.

Re: Coinbase is launching support for the USDC stablecoin

#317

Post by Paladiamors »

I've taken a look at the many threads happening here and a large number of people discussing the "worthlessness" of the having a stable coin because of the lack of volatility vs the USD.

I'm actually quite interested in the outcome of this, especially because of transaction fees for credit card payments are so high. For some places in Asia, Japan in particular has credit card transaction fees of in the 3.6% range and going up to 4.5% for international cards.

For businesses selling services in the $2500 range, just at 3.6% of this transaction becomes $90 in fees just for a single transaction. Which, I think, is quite high just for moving a digital asset around.

While the prospects of "trading" this asset might not be as interesting, the potential for far lower transaction fees for people running a business seems very attractive to me.

Re: Coinbase is launching support for the USDC stablecoin

#318

Post by beaner »

IncRnd wrote: post #117
beaner wrote: post #33

Earlier quoted context omitted.

Except you can't send between the two. Isn't that so silly? You can send USDC to/from any wallet that implements it. This is a benefit of the blockchain, a protocol for money.

You say that Venmo and Square are inferior to USDC, because the first two cannot communicate with each other. Then, you say that USDC is superior, because it cannot communicate with the other two.

I didn't say that USDC is superior because it cannot communicate with the other two.

I'm saying its superior because if adopted it would unite the two.

Re: Coinbase is launching support for the USDC stablecoin

#319

Post by anders94 »

Entangled wrote: post #297
anders94 wrote: post #155

Hi, I'm Anders Brownworth, Chief Evangelist at Circle. I'm happy to answer any questions on USD Coin, CENTRE or Circle. We're also hiring! See https://circle.careers/

Why did you pick Ethereum instead of Ripple or Stellar? They have lower transaction fees and almost instant transfers in the seconds while their token contracts are way easier to setup and maintain if you are thinking on adding EUR, GBP, YEN, etc in the future. The only real advantage of Ethereum is their user base which is important but not the only decisive factor.

We considered a wide range of platforms before making a decision. At this point, however, Ethereum is really the only viable option particularly from a security and wallet support perspective. That said, we have been developing the technology in such a way that it can be adapted to other blockchains in the future should CENTRE choose to do that. However, while incredibly important, the contract implementation isn't nearly as much work as the legal, operational, risk and audit components necessary to connect the traditional financial system to cryptocurrencies in an open and compliant way. Should CENTRE choose to provide an implementation on another blockchain, much of those other components would simply apply with little modification.

Re: Coinbase is launching support for the USDC stablecoin

#320

Post by anders94 »

jatsign wrote: post #133
jessepollak wrote: post #107

Hi all — head of engineering for the consumer product at Coinbase here (iOS, Android, coinbase.com). Happy to answer any questions that people have — also, just wanted to make a plug that we're hiring. If you're interested in building an open financial system for the world, shoot me a note at jpollak@coinbase.com. Especially interested in iOS & Android engineers!

Have you published the USDC contract to the network?

Anders Brownworth from Circle here - I just wanted to point out that https://etherscan.io/address/0xa0b86991c6218b36c1d19d4a2e9eb... is the proxy contract. (an address that won't change but who's source code doesn't contain the "meat" of the logic) That contract simply proxies calls to the current main FiatToken contract deployed at https://etherscan.io/address/0x0882477e7895bdc5cea7cb1552ed9... but if you want to see the official repository for the project, it is available from CENTRE on GitHub at https://github.com/centrehq/centre-tokens
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