“USDC as an Ethereum asset can only exist as a single valid version,” says the team at Circle.
On Tuesday, Circle, the issuer of the USDC stablecoin, pledged its full support for the transition of Ethereum to a proof-of-stake, or PoS, blockchain after the much-anticipated Merge upgrade. The firm views The Merge as an important milestone in the scaling of the Ethereum ecosystem, writing:
“USDC has become a core building block for Ethereum DeFi innovation. It has facilitated the adoption of L2 solutions and helped broaden the set of use cases that today rely on Ethereum’s vast suite of capabilities. We understand our responsibility for the Ethereum ecosystem and businesses, developers, and end users that depend on USDC, and we intend to do the right thing.”
Currently, USDC is both the largest dollar-backed stablecoin issued on Ethereum and the largest ERC-20 asset overall, with over $45 billion in market capitalization residing in the ecosystem at the time of publication. Its reserves are audited and held at U.S. financial institutions such as BlackRock.
Unlike others, Circle continued that it does expect any issues as the Ethereum blockchain begins its transition, stating:
“We do not anticipate disruptions to USDC on-chain capabilities nor our fully automated issuance and redemption services. Circle’s testing environment is connected to the Goerli Ethereum testnet, and we will monitor closely as it merges with Prater in the coming days.”
The company is following suit alongside an increasing number of firms that vouch to transition to Ethereum’s POS blockchain upon completing The Merge. The day prior, Chainlink said it would not support any proof-of-work forks after the upgrade. Due to the proximity of the upgrade, Ethereum layer-two solution Optimism has seen its token skyrocket by over 300% as per Merge speculation.