Circle recently announced that it had partnered with Genesis to accelerate the adoption of the USDC stablecoin in the mainstream financial world. As part of the partnership, Digital Currency Group (DCG), the parent company of Genesis will make a $35 million investment into Circle. Besides that, the two firms plan to launch joint products to boost the new line of USDC-based yield and lending products for developers and businesses.
Growing Interest in Stablecoins
2020 has been a great year for dollar-based stablecoins. Thus far, the USD-based stablecoin market is estimated to be worth around $12.5 billion. Besides that, on-chain transaction volumes have accounted for the largest share of blockchain transactions. Recently published data by Messari estimates that on-chain stablecoin transactions will be worth around $600 billion by the end of 2020. To put things into perspective, the total transaction volume of PayPal in 2019 was $712 billion.
Amazing Growth for USDC
The USDC stablecoin has experienced amazing growth in 2020. It is currently the fastest-growing stablecoin in the world. At the start of 2020, its circulation was around 400 million, but today it hovers around 1.1 billion. The stablecoin’s usage has expanded into payments, savings, lending, and many other use cases. Hundreds of firms within the blockchain world have integrated USDC into their operations.
Based on this exemplary growth, Circle launched two products in Q2 2020. These products include the Circle API and the Circle Business Accounts. The new products provide firms, fintechs, and other financial companies with a suite of APIs and accounts that allow for USDC integrations.
During the same period of exemplary growth for USDC, Genesis has also experienced growth as the largest lending facility in the market. The company has seen elevated volumes in lending across various institutional customer segments. In Q1 2020, the company issued over $2 billion in loans. Besides that, the company has originated more than $8 billion since its founding in March 2018. During this period of growth, the company has seen USDC become one of the most sought-after lending and borrowing assets. The reason for this growth is the demand by the market for a reliable payment method and a well grounded store of value.
The Genesis Circle Solution
The partnership between Circle and Genesis will help introduce solutions to the market for developers and businesses. This includes developers and businesses who are looking for yield from customers or their own USDC inventory. Besides that, the partnership will offer USDC-powered credit solutions for merchants and businesses that use USDC for payments or a store of value.
What the Leadership Had to Say
Commenting on the issue, Michael Moro, the Genesis CEO, said that:
"Circle has been a pioneer in the digital currency market, building innovative products and services, and has consistently provided our industry with leadership on technology, standards, and regulatory policy. With the rapid rise of USDC, we are clearly seeing mainstream momentum for digital currencies, and through this partnership with Circle we believe we can materially advance our shared mission of building a new global financial system."
The Circle CEO, Jeremy Allaire, had equally positive sentiment, stating that:
"Digital Currency Group has been an incredible leader in the growth of the digital asset market, and Genesis has become one of the most important core providers in crypto finance. Combining Circle's powerful capabilities with USDC payments and platform infrastructure for businesses, with Genesis's global institutional underwriting capabilities, will allow us to deliver significant value to companies holding and using USDC as part of their business."