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Isn't it even their duty to buy it?

I don't know how USDC is set up. But I thought stablecoins work like this: The creator sells their coins at $1.01, so it will never go beyond $1.01 as it would be cheaper to by from the creator. They buy their coin at $0.99. So it will never go below $0.99 as it would be better to sell to the creator.



That is definitely not how USDC is set up. The creator takes 1 USD, and gives back 1 USDC and vice versa. In this case, some of the USD held at SVB disappeared, so Circle has less money for the USDC -> USD redemptions. There needs to be a 1:1 backing, otherwise a stable coin is just smoke and mirrors.


    creator takes 1 USD, and gives back 1 USDC and vice versa
How do they make money then?


They invest the USD. If the investments work out, they keep the profits. If they don’t, the customers just got crypto’d


Short term treasuries. They're a liquidity provider for the US government.


Transaction fees I think?


Yes, presumably redemptions will remain open come Monday. As far as I know Circle creates and redeems at par, they don't charge 100bps or whatever.


If they buy and sell at $1, how do they finance their operation?


They buy treasuries and collect 4.5% on $40 billion.




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