Coinbase, the largest crypto exchange headquartered in the United States, announced today that they have listed USD Coin (USDC), a stablecoin originally launched by Circle, but now Coinbase is listed as a Co-Founder. This is the first time a stablecoin has been listed on Coinbase, and only the 7th cryptocurrency to ever be listed on the platform, others being Bitcoin, Ethereum, Bitcoin Cash, Ethereum Classic, Litecoin, and 0x.
Notably, USDC is an Ethereum ERC-20 token, making it the 2nd ERC-20 token to be added to Coinbase, with the first one being 0x, which was listed less than 2 weeks ago on 12 October 2018. When 0x was listed on Coinbase it was speculated that it would be easy for Coinbase to list other ERC-20 tokens since they use the same backbone technology, and this has already come to fruition with the listing of USDC. There are numerous other ERC-20 tokens among the top cryptos, and in the coming weeks and months, it is likely that Coinbase will keep listing ERC-20 tokens and other cryptos, as per their announcement about listing all possible major cryptocurrencies.
Generally when a crypto is listed on Coinbase they experience the Coinbase Effect, which is a rally resulting from Coinbase users buying the crypto as soon as it is listed. This is because Coinbase is perhaps the most well-known crypto exchange in the United States, and due to the lack of cryptos listed, there is a strong thirst for any new cryptos that get listed.
Since USDC is a stablecoin and pegged approximately to the value of a single USD, its price will not rally due to being added to Coinbase. The way to measure a stablecoin rally or crash is with its market cap since the market cap indicates how much of the stablecoin has been purchased. USDC launched in late September, so the market cap was technically zero up to that point. The market cap grew to USD 10-15 million, until the middle of October 2018 when Tether (USDT), the #1 stablecoin with a market cap in excess of USD 2 billion, had problems and become unpegged from the USD. By 19 October the USDC market cap was in excess of USD 30 million. Following the listing on Coinbase today, the USDC market cap has already more than doubled to USD 62 million.
Since USDT continues to be volatile and is worth less than USD 1, this will give USDC the opportunity to rapidly increase its market cap and perhaps compete with USDT, especially now that Coinbase has listed USDC.
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