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Circle in Plans to Create a Dollar-Pegged Cryptocurrency; Raises $110 Million

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Circle, the Goldman Sachs-backed cryptocurrency, has managed to raise $110 million in an investment round under the leadership of Bitmain Technologies, the Chinese virtual coin. According to the Boston-based company, a new cryptocurrency that will be pegged to the US Dollars is in the offing. This, it says, will make it possible for consumers and businesses to transfer value even more efficiently. Each token, dubbed the Circle USD Coin (USDC), will be backed by the US dollar reserves. The coin is expected to launch this summer.

The Constant Strive to Remain Relevant

Cryprocurrencies such as Bitcoin have been in a constant battle to stand out as alternative forms of payment, partially due to their high volatility. However, with Bitcoin technology, businesses hope that they can make transactions much faster and cheaper.

According to Circle, a cryptocurrency that pegs its value to a stable traditional form of currency can go a long way in terms of driving the adoption of systems based on blockchain. Jeremy Allaire the Chief Executive Officer at Circles, was clear in his opinion at a media event:

It is difficult to use something like Bitcoin if the volatility is so high. Something like this makes it more possible. The new coin will be initially issued by the startup and run on a network managed by Centre, a wholly owned subsidiary of Circle. The company plans to make Centre independent as other firms join the network.

In connection with its investment, Bitmain will also be involved with Centre. and will thus help in launching coins linked to any legal tender or other fiat currencies. 

What do you think about Circle’s plan to create a cryptocurrency pegged to the US dollar? Is this a viable option? Let us know your thoughts in the comments section below.

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