It has been announced that Coinbase and Circle have managed to redefine their relationship, according to announcements made on the blogs of both Circle and Coinbase on the 21st of August. The two organizations had recently launched the USD coin jointly, and had until quite recently, governed the token through the Center Consortium. It has now been announced that the Center Consortium will no longer serve as a stand-alone entity, according to the blog post. Further, the operations and governance will be handled inside the house. Circle will have enhanced responsibilities, which include the holding of smart contract keys, and regulatory compliance.
Coinbase Will Not Be In Collaboration With Circle Anymore
Various crypto firms had attributed the move to increased regulatory clarity. The co-founder and CEO of Circle, Jeremy Allaire, stated in an X thread that Coinbase and Circle are deepening and extending the commercial relationship, with Coinbase managing to take an equity stake in Circle. As far as the Coinbase share is concerned, no value was stated. It is believed that this new arrangement will be increasing the strategic and economic alignment of the firm. Also, the interest revenue will continue to be shared between them- entirely based on the holdings of the stablecoin.
Coinbase and Circle had launched the USDC together back in 2018, and according to CoinGecko, USDC had turned out to be the second-largest stablecoin in the world by market cap at $26 billion, with just Tether ahead of it- with a mammoth $83 billion. Circle has also been bracing for the introduction of the new stablecoin, PayPal USD, which was launched on the 7th of August. The blog post has also announced that USDC will be launching six new blockchains in September and October. Interestingly, it did not specify the new blockchains, but the expansion of USDC into Optimism, Polkadot, and Arbitrum was announced back in September.