Amid increasing concerns about the credibility of Tether’s USDT, Coinbase has announced a campaign to encourage users to switch to its own stablecoin, USDC.
By eliminating conversion costs, Coinbase hopes to emphasize the quality of the Circle-backed USD coin reserves.
In a Friday blog post, the company stated, “Recent events have put some Stablecoins to the test, and we’ve seen a flight to safety. We believe USDC is a reliable and trustworthy Stablecoin, so we’re making it easier to switch.”
Coinbase has highlighted the importance of trust and stability for its customers, noting that USDC is one of the most well-known Stablecoins.
This is likely due to its high-quality reserves, which has seen its market share expand over the past couple of years.
To ensure transparency, Grant Thornton LLP, a leading audit, tax, and advisory company in the U.S., provides monthly attestations.
Coinbase adds that USDC is backed by cash and short-dated U.S. treasuries held in U.S. regulated financial institutions.
Data from the blockchain indicates that USDT is the third-most frequently traded digital asset on Coinbase, making up 5% of all trading volume.
Despite this, the Stablecoin issuer has yet to undergo a comprehensive audit of its reserves, yet maintains that its currencies are fully backed.
Recently, the press has accused Tether of lending out its own currencies to customers and not having sufficient liquidity to back the token in a crisis.
In response, Tether issued a blog post refuting these claims, citing multiple misunderstandings of the token and USDT.