5 Things you Should Know About Staking USDC

Do repost and rate:

Content of article:

So, many people in the ecosystem are trying to look for alternatives to stake USDC and get USDC as staking yields. In this article, we are going to have a closer look at staking USDC by answering 5 popular questions about USDC.

A consortium by the name of manages USDC. However, it’s that founded this consortium. Members of Circle include COINBASE and Bitmain, a bitcoin mining company. Just to clarify, it is a private company that issued USDC. This means that it is not a

Furthermore, Circle claims that they back each USDC with cash and short-dated U.S. treasuries. As a result, you can always redeem USDC 1:1 for US dollars. Circle claims to hold these reserves ‘in the custody and management of leading U.S. financial institutions‘. For example, BlackRock and BNY Mellon.

Each month, Grant Thornton LLP, a third-party company, assures the size of the USDC reserve. They are one of America’s largest audit, tax, and advisory firms, as the Circle website states. In the same manner, they are also regulated as licensed money transmitters under U.S. state law. This puts them level with PayPal, Stripe, and Apple Pay. 

Source:

Staking USDC has relatively low risk. However, there are some risks. Here are four to consider:

  1. The U.S. government is not involved with issuing the USDC: As a result, USDC doesn’t have any FDIC or SIPC insurance. A US dollar savings account will have this insurance. In other words, the USDC is not legal tender, so the US government doesn’t insure it. On the other hand, Centre, are fully regulated. They are a licensed financial institution. In other words, they report their reserves each month. This is how they prove that the USDC is fully backed by the US dollar.
  2. USDC uses the Ethereum blockchain: So, there can be cyber threats. For instance, a 51% attack. However, considering the size of the Ethereum network, it’s not likely this will happen.
  3. Any interest percentage can change without warning: The crypto projects offering these percentages all have a small print in place. This is precisely what it tells you.
  4. Intermediaries: Make sure that the project, you receive interest from, doesn’t invest your USDC with a third party.

Here is an example:

Yes, staking USDC can be worth it. However, many platforms that offered a high-interest percentage in early 2022, are now closed down. Platforms like Celsius, Voyager, or Vauld. They all got caught up in liquidity issues. As a result, they suspended withdrawals.

However, there are still good interest percentages available for USDC.

  • —Currently they offer 15% on staking USDC in their liquidity pool. It’s important to note that dYdX doesn’t act as a custodian. However, they pay out yield in DYDX tokens.
  • Midas.Investments—They offer 11.6% on USDC. Their boosted rates are 14.7%. They are a custodial crypto-investment platform. They mix CeFi with DeFi.
  • unFederalReserve—They offer 6.41%. They bridge the gap between DeFi and TradFi.
  • MyCointainer—They currently offer a 10% APR on USDC. However, they get mixed reviews.

Staking USDC works straightforwardly. The different platforms will all have a different way of how you can stake your USDC. However, the bottom line is that you will need to:

  • Deposit USDC onto the platform.
  • Once your USDC is on the platform, you follow the staking guidelines as described by each platform.

The easiest options are exchanges. You can also opt for specialized staking platforms. In general, they lend your USDC to borrowers. In return, you receive a reward that can be the platform’s native token or even USDC too. Here is an example:

You may want to use caution with platforms. They tend to lend your assets to a third-party platform. We have seen the problems this can cause. For example, with

We already mentioned four platforms that offer good interest for USDC. Here are a few more options:

  • MyConstant—They offer 12.5% on USDC. This is a P2P crypto-lending platform. 
  • Crypto.com—They offer up to 14% on USDT if you stake $40,000. However, you need to commit for at least one month. Staking rates drop when you stake less than $40,000.

We answered five questions related to staking USDC. As a result, you know if staking USDC is safe. We also discussed the best staking options and how staking USDC works. You also know now if staking USDC is worth it. Happy staking!

 https://www.altcoinbuzz.io

Regulation and Society adoption

Ждем новостей

Нет новых страниц

Следующая новость

All content provided by the site, hyperlinks, related applications, forums, blogs, social networks and other information is taken from third-party sources and is intended for reference only. We make no warranties with respect to our content, including but not limited to accuracy and timeliness. No part of the content we provide is financial advice, legal advice or any other form of advice intended for any of your personal purpose. Any use of our content is entirely at your own risk. You should conduct your own research, review, analysis and verification of our content before relying on them. Trading is a very risky activity that can lead to large losses, so consult your financial Advisor before making any decision. No content on our site is a public offer or invitation to action.

This resource may contain 18+materials

© 2016-2024