Coinbase and Circle Centre Consortium have expanded USDC from Ethereum to Algorand’s blockchain as part of its multi-chain USDC framework—to bring scalability and performance improvements to the digital dollar stablecoin for global consumer payment adoption.
The Coinbase and Circle Centre Consortium which oversees the governance of the US Dollar Coin (USDC) has released a mainnet implementation of the stablecoin on the Algorand blockchain. The additional support of Algorand is to ensure USDC has the flexibility to support everything from emerging DeFi projects to large-scale financial institutions as an official chain of its USDC digital dollar stablecoin.
The USDC is the second-largest digital dollar stablecoin by volume and was originally supported by only the Etheruem blockchain, which as of late has been displaying some issues trying to support the DeFi ecosystem.
The Centre Consortium said in an announcement, “As evidenced by the recent and very rapid growth and usage of stablecoins on public chains like Ethereum, there is a tremendous need for blockchain infrastructure that can scale to support significantly higher transaction throughput and lower fees on public Layer 1 blockchain infrastructure.”
Algorand is Faster than Ethereum
USDC crypto asset has increased in market cap from around $500 million at the start of 2020 and currently sits at just under $1.9 billion according to Coinmetrics.io.
This expansion of support for USDC on new blockchains from being purely Ethereun based—comes as USDC has rapidly grown to over 1.8 billion in circulation, experiencing more than 3x growth in the past six months and, according to the Centre Consortium, becoming the world’s leading compliant and regulated digital dollar stablecoin.
In a recent interview, Keli Callaghan, Head of Marketing at Algorand was asked about the difference of transacting with the Algorand blockchain versus Ethereum. She said bluntly, “Your transactions will be much faster.”
As stated in the release, the Algorand network is currently capable of much faster transactions at scale than Ethereum:
“Algorand brings over 1,000 tps and transaction fees of 1/20th of a cent to the USDC ecosystem, and soon to be released innovations from Algorand offer the potential of scaling throughput by 8-10x on Layer 1, accompanied by new secure smart contracts that complement standard tokens such as USDC.”
Jeremy Allaire, CEO and Chairman of Circle explained it more simply. Allaire said:
“Ethereum supports around 15 transactions per second. Algorand enables over 1000 transactions per second, with work underway to increase that ten-fold in the coming months.”
The Algorand Foundation, which is purportedly already a pure POS blockchain has been gearing up to take its place in the Decentralized Finance (DeFi) ecosystem. Algorand recently announced comprehensive smart contract capabilities that will purportedly enable DeFI developers to create Defi solutions and Dapps that “can scale to billions of users” while benefiting from the security of its base layer Algorand protocol.
How Long Will Ethereum Dominate DeFi?
Meanwhile, Ethereum continues to face issues with scalability and gas fees as it appears the network’s existing infrastructure simply cannot keep up with levels of demand of DeFi. Ethereum advocates are concerned that any further delays to the launch of ETH 2.0 could cause more DeFi protocols and users to consider other blockchain platforms.
There have been issues with the recent launch of ETH 2.0 testnet Medalla and concerns from developers that more delays could be expected. Vitalik Buterin also recently admitted that ETH 2.0, the transition of Ethereum from PoW to pure PoS—is much more complex than he originally thought.
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