You'll learn about USD Coin (USDC), commonly referred to just as USDC, and how you can use it in Best Wallet.

USDC is a stablecoin cryptocurrency that is pegged at a 1:1 value with the US Dollar.

Essentially, it serves as a tokenised version of the US Dollar, with the value of one USDC token designed to mirror that of one US dollar as closely as possible (1 USDC = $1).

USDC is designed to offer the stability of a fiat currency (US Dollar) but with the operability and function of a normal cryptocurrency.

Stablecoins are a special type of cryptocurrency engineered to maintain a steady value, typically pegged to a national currency like the US Dollar.

Stablecoins like USDC offer stability in crypto, especially in times of market volatility. There are several major types of stablecoins:

Read our guide on stablecoins and how they work.

USDC is designed to have a full reserve backing, meaning that for every USDC token in circulation, there exists an equivalent amount of US dollars securely held in reserve.

This means that USDC is entirely backed by reserves, ensuring holders can redeem their tokens for US Dollars at any time, maintaining the 1:1 ratio.

This level of collateralisation not only ensures USDC maintains its stable 1:1 pegging with the US Dollar but also instils trust and confidence, making USDC the second largest stablecoin by market capitalisation.

Holding USDC tokens offers many advantages.

It offers a means to store funds in a stable cryptocurrency, meaning you can buy and hold USDC and know that it will have the same value in six months. This is rare when buying cryptocurrencies, and many major cryptocurrencies such as Ethereum ($ETH) are volatile and their prices fluctuate daily.

Because USDC is backed by real dollars, it offers the stability of the US Dollar with the capability of cryptocurrencies. You can swap USDC for other cryptocurrencies, and engage with projects and DEXs with your USDC, all with your Best Wallet.

By buying and holding a large amount of USDC tokens in Best Wallet, you can quickly swap for trending cryptocurrencies, allowing you to react quickly to market movements. It essentially allows you to store fiat currency in the form of a crypto token in your Best Wallet, making it easier to acquire new cryptocurrencies.

Overall, USDC provides a secure and stable means to engage with crypto and crypto projects and acts as a hedge against market volatility.

Whilst holding and trading USDC can offer many benefits, it's important to note that there can be drawbacks.

For one, there can be no price appreciation - USDC offers stability but can also never offer any form of profit. Whilst many cryptocurrencies, such as Ethereum ($ETH) can rise in value by 10-50% in 6 months, USDC cannot.

Additionally, there are drawbacks to being tied with a fiat currency like the US dollar, because this therefore links the cryptocurrency with the traditional finance system.

In March 2023, USDC became unpegged to the US Dollar due to the collapse of Silicon Valley Bank. Because USDC had tied up almost 8% of its $40 billion reserve at Silicon Valley Bank, when the bank collapsed, not only were the USDC reserves threatened, but so was user confidence. This led to a drop in its 1:1 peg, meaning at its lowest time during this period, 1 $USDC equalled 0.87 US Dollars.

USDC quickly addressed the issue, regained a 1:1 peg, and placed safeguards and regular audits to avoid a repeat, but it exemplifies one of the risks when buying a stablecoin like USDC.

Yes, you can buy USDC directly within the Best Wallet app. By going to the "Buy" option with Best Wallet, you can purchase USDC directly using a range of methods, including Apple/Google Pay, credit card, or bank transfer. Because Best Wallet has integrated with Onramper, you also get the most competitive prices for your USDC purchase.

Read our guide on how to buy crypto in Best Wallet.

Yes, you can easily swap your USDC for another crypto, as long as it's on the same network as your USDC tokens. You can own USDC on all three supported networks in Best Wallet (BNB Smart Chain, Ethereum, and Polygon).

USDC offers a stable and relatively secure cryptocurrency, with its deep US Dollar reserves and regular audits. Owning USDC can not only help hedge against market dips but also allow you to quickly swap for quick-rising cryptocurrencies. Buying and holding an amount in USDC allows you full speed and flexibility when swapping in Best Wallet.