In a recent report, Circle CEO Jeremy Allaire made a remarkable revelation about the adoption of USD Coin (USDC), stating that 70% of its adoption originates from countries outside of the United States. Taking to Twitter on August 8, Allaire shared this surprising statistic with his 131,300 followers, refuting the misconception that USDC is primarily focused on the U.S. market. He emphasized that the rapid growth of USDC is prominently seen in emerging and developing markets, particularly in Asia, Latin America (LATAM), and Africa.
Interestingly, Paolo Ardoino, the Chief Technology Officer (CTO) of rival stablecoin issuer Tether, echoed a similar sentiment, affirming that their stablecoin, USDT, is also gaining significant traction in non-U.S. regions. In February, Arduino described USDT as a “safe tool for emerging markets and developing countries.”
As Cointelegraph reached out to Circle for further insights on their non-U.S. expansion, a response has yet to be received at publication, leaving the market eager for additional information.
Allaire’s statements come amidst an announcement from PayPal regarding the launch of its USD-pegged stablecoin, PayPal USD (PYUSD). In response to this development, Allaire congratulated PayPal and Paxos, excited to see a prominent internet and payments company venture into the stablecoin space. He believes that regulatory clarity is a catalyst for such expansions.
However, recent data indicates a decline in USDC supply since the beginning of 2023, primarily due to decreased demand and a surge in redemptions. Consequently, the stablecoin’s market share has shrunk to a mere 21%, with its total circulation amounting to $26.1 billion.
Addressing concerns over USDC liquidity, Allaire acknowledged that redemptions were outpacing issuance. He remarked, “Over the past month, we’ve issued $5B USDC, and have redeemed $6.6B USDC,” underlining the ongoing effort to manage liquidity effectively.
Circle is actively expanding its global banking and liquidity network to counter these challenges. The company is collaborating with top-tier banks across critical regions worldwide, reaffirming its commitment to ensuring a robust and stable financial ecosystem.
In a transparency report released on August 3, Circle disclosed the composition of its Circle Reserve Fund, which comprises 93% short-dated US Treasuries, overnight US Treasury repurchase agreements, and cash. The remaining 7% is held in cash reserves at banks.
Circle secured a Major Payment Institution (MPI) license from the Monetary Authority of Singapore (MAS) in early June, signaling its dedication to compliance and regulatory adherence in expanding its services.
The revelation by Circle CEO Jeremy Allaire has shed light on the remarkable global demand for USD Coin, extending well beyond U.S. borders. With the stablecoin gaining momentum in emerging and developing markets, its potential impact on the global financial landscape becomes more apparent. As the company works on enhancing liquidity and partnerships with leading banks worldwide, the future of USDC seems promising in terms of growth and stability.