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After Three Years, Circle Reveals USDC Reserves

Circle Stablecoin Transparency

Last updated: June 26, 2023 06:55 EDT

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Linas Kmieliauskas

Author

Linas Kmieliauskas

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Last updated:

June 26, 2023 06:55 EDT

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It took nearly three years for US-based crypto company Circle, the issuer of major stablecoin USD Coin (USDC), that is preparing to go public, to finally reveal how this token is backed.

In their latest attestation report, prepared by auditors at Grant Thornton, the company said that, on May 28, cash and cash equivalents (e.g. securities) comprised 61% of their reserves.

1 – Cash includes deposits at banks and Government Obligation Money Market Funds. Cash Equivalents are defined as securities with an original maturity less than or equal to 90 days in accordance with generally accepted accounting principles (US GAAP). 2- USD denominated Certificates of Deposit issued in the US by branch(es) of Foreign Banking Organizations. Minimum S&P rating of S/T A1; maximum maturity of 13 months. 3 – Maximum maturity of 3 years. 4- Unsecured debt obligations of corporations and financial institutions with original maturities between 91 days and 13 months. Minimum S&P rating of S/T A1; maximum maturity of 13 months. 5- Unsecured debt obligations of corporations and financial institutions with a remaining maturity of less than or equal to 3 years. Minimum S&P rating of BBB+; maximum maturity of 3 years. 6- Overall portfolio maintains an average credit rating of A or better on S&P scale and weighted average maturity of less than or equal to 1.5 years. Source: Circle

Per the auditors, the total fair value of US dollar-denominated assets held in segregated accounts are at least equal to the USDC in circulation at the report date.

“Since nearly three years ago when the first USDC entered circulation, Circle, together with Centre Consortium, have prioritized trust, transparency, and accountability,” Jeremy Allaire, Founder and CEO of Cirlce, said in a statement.

He added that as USDC in circulation “has grown more than 2,600% since the beginning of 2021, so too has our own commitment (along with external calls) to enhanced transparency of the composition of dollar-denominated assets.”

“Finally, as we march towards becoming a listed company, we will be filing quarterly audited financials and management disclosures that will be required as an SEC-regulated public company, and will include USDC reserve composition disclosures similar to our attestations,” Allaire added.
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Learn more:
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