How To Buy USD Coin (USDC)? – Forbes Advisor INDIA

USD Coin (USDC) is a stablecoin designed to keep a constant one-to-one value with the U.S. dollar. Stablecoins like USDC aren’t seen as investments; they offer liquidity for crypto traders looking to purchase other cryptocurrencies seamlessly on exchanges.

What Is a USD Coin?

USD Coin is a stablecoin built on the Ethereum (ETH) blockchain. Like other collateralized stablecoins, USD Coin’s value is pegged to the U.S. dollar. That means that one USDC should ideally always be worth one dollar.

More than 19,000 cryptocurrency projects are out there, but USDC is one of the biggest. It earns top billing as the second biggest stablecoin after Tether, with more than $119.73 billion in circulation as of Oct. 11, 2024. It’s also the third largest in market cap among all cryptos.

USD Coin was launched in 2018 by Centre, a consortium founded by Circle and Coinbase. It was created as a regulated stablecoin that “works within U.S. money transmission laws and regulations” while running on blockchain technology.

Similar to concerns made about Tether, USDC was flagged last year for not backing each USDC with an asset or dollar equivalent.

Centre responded to these revelations in August 2021, saying it would change the makeup of USDC’s reserve and that the coin’s underpinnings would be held entirely in cash and short-duration U.S. Treasurys.

That recent move now means either one dollar or asset-equivalent backs every USDC.

Increasing some transparency, accounting firm Grant Thornton audits those accounts and posts monthly draft attestation reports accessible to the public.

Fabio Pezzotti, chief executive officer of Milan-based crypto investment fund Iconium, says, “With its launch coming after the concerns raised about Tether’s lack of transparency, USDC aims at providing all the advantages of a stablecoin while being fully transparent to users.”

USDC in the Digital Economy

USDC investors generally use their holdings to earn passive income. You can lend USDC directly through its issuer, Circle, or with a hardware wallet like Ledger.

USD Coin holders can earn additional passive income through specialty online savings accounts designed exclusively for stablecoins.

Experts say stablecoins often receive the highest returns because they maintain their expected value.

You can earn appreciable interest on your USDC, substantially higher than the typical online savings account. USDC holders can use Bitcompare to find the most attractive yields currently available.

Where Can I Buy USDC?

You can buy USDC at several different crypto exchanges. Here are a couple of places where you can exchange INR for USDC:

Since USDC is a stablecoin, it’s not “paired” in the true sense of other crypto pairings. But more than a few exchanges let you purchase other cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) using USD Coin:

If you want to use your USDC to purchase other crypto coins like Litecoin or Dogecoin, you can make that happen on KuCoin.

How To Buy USDC

If you’re ready to buy USD Coin and assume the risks of cryptocurrency investment, it only takes a few steps to get started:

1. Choose a Crypto Exchange

To buy USDC in the U.S., you’ll need to use a crypto exchange. A cryptocurrency exchange is an online marketplace where you can buy and sell crypto.

You should review several platforms to find the best cryptocurrency exchange for your needs. Exchanges have widely different user interfaces, fees, and rules. Research can help you feel comfortable with the exchange you choose.

Note: Choose a crypto exchange that is FIU-IND registered. 

2. Buy USDC

Once you’ve found the perfect exchange, you’re ready to buy USDC. While USDC’s backing has kept its value stable, it’s still a cryptocurrency and risks losing value. Be sure to fund your account only with money you won’t need for monthly expenses or emergencies.

You can place an order on your chosen exchange with just a few steps:

1. Enter the amount of USDC you want to buy in rupees.
2. Select the order type (market, limit, etc.).
3. Complete the trade.

You’re now the proud owner of USD Coin.

3. Store Your USDC

Once you purchase USDC, there are lots of different crypto wallets where you can store your coins:

• Hardware Wallets. Referred to as “cold storage” or “cold wallets,” these physical devices sometimes look like USB drives. You download your crypto from the web onto these drives and store it—Ledger and Arculus both support USDC.
• Paper Wallets. Paper wallets let you print public and private keys and QR codes, which keeps your data offline and protected from potential hacks.
• Software Wallets. You can also download crypto wallet software like Exodus or Vibes directly to your computer or mobile device to store your USDC.
• Crypto Exchanges. Many exchanges offer customers a built-in crypto wallet to manage their crypto holdings on the site. For example, CoinDCX and Zebpay each offer wallets.
  Users can also store their USDC with a Circle Account.

What Can You Buy With USDC?

According to Cryptwerk, more than 600 merchants accept USD Coin as payment. These various merchants let you use your USDC in a variety of ways:

• Buy gift cards to your favorite stores on Conisbee.
• Register the domain name for your following website.
• Secure a hotel stay (though the options are pretty slim).

And, of course, you can also use your USDC in the traditional sense to buy other cryptocurrencies.

Should You Buy USDC?

Stablecoins have had a rough streak lately, causing ripples across the cryptocurrency landscape. Despite headwinds in the crypto market amid the TerraUSD stablecoin crash in May, which wiped out $42 billion for UST and LUNA holders, USDC managed to maintain its $1 peg.

However, crypto traders shouldn’t consider USDC an investment, although it’s a coin with some advantages.

“USDC isn’t inherently an investment vehicle,” says Axel Nussbaumer, vice president of digital asset management at Dallas-based crypto mining firm Blockmetrix. “But it does a perfectly fine job of serving its intended purpose—to allow traders to derisk, avoid volatility, and transact cheaply and quickly.”

Current economic conditions should be considered because USDC might be perceived as a safer, more credible port to ride out the stablecoin storm than other coins.

And remember, no investment is without risks.

When buying USD Coin, factor in your financial goals and see if the risks make it the suitable buy for you.