USDC Issuer Circle Plans to Invest in Circle Reserve Fund in Bear Market

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The USDC issuer has started investing funds in its CRF (Circle Reserve Fund) to ensure that holders can redeem their coins whenever they want.

Many crypto companies have faced problems in 2022 due to the market crash. Some have downsized, while others have filed for bankruptcy. In general, the whole market felt the impact of the crypto winter and investors also lost billions of capital.

As a result, those who survived the accident take steps to avoid such situations in the future. In addition, most companies aim to better protect their customers’ funds in times of crisis. On that note, Circle has taken a bold step to prepare for such situations.

About the Circle Reserve Fund

Circle partnered with BlackRock when creating the Fund. BlackRock is the world’s largest asset manager. It was established in 1988 and focuses on managing its clients’ assets and helping them minimize risk. The company is based in New York and has a total of $10 trillion in AUM (assets under management).

Cryptocurrency Market Exceeds $1 Trillion | Source: Total Crypto Market Cap at TradingView.com

The fund created by Circle is already registered under Rule 2a-7 government money market funds under BlackRock. According to the details, the Fund contains short-term US Treasury bills and cash.

The Fund will operate under the control of an independent board of directors and will publish the portfolio holdings report daily. In addition, it complies with the provisions of the Investment Companies Act 1940.

Only Circle can access the Fund and plans to purchase new Treasury holdings with the proceeds. Additionally, the USDC issuer aims to store its Treasury holdings in the Bank of New York Mellon-controlled Fund. Circle has already started the process and plans to round it out by the first quarter of 2023.

How has the USDC performed so far?

In the stablecoin market, USDC is the second largest crypto by market capitalization after USDT. The stablecoin is pegged to the US dollar and has continued to grow in recognition and acceptance.

Circle continued its efforts to make USDC a widely adopted option. The company plans to release it on more networks, including Cosmos, Polkadot, Arbitrum, Optimism, and Near. USDC will enter the COSMOS blockchain in early 2023, with others to follow by the end of 2023.

Additionally, Circle will soon start issuing cryptos in Singapore. He has already obtained the authorization to acquire a license to manage a payment establishment in the country. This license enabled it to handle cross-border and domestic payments in Singapore. The company received approval in November 2022.

Circle aims to make USDC a go-to stablecoin among US crypto investors. It’s safe to say that the company could soon accomplish the feat.

Coinbase recently revealed that more people buy USDC with USD than those who believe in other fiat currencies.

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