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> I said USDC has said that is using fractional reserves. I did not say that it is insolvent. It doesn't matter. USDC promises 1:1 backing of dollars for cash
by rglullis 4y ago
> I said USDC has said that is using fractional reserves. I did not say that it is insolvent.
It doesn't matter. USDC promises 1:1 backing of dollars for cash or "cash-like instruments". If they are not able to not attest this and they minted more USDC than they should, they are breaching this promise.
- jcranmer 4y agoThe asset classes they have previously admitted to investing in are similar asset classes to those that money market funds have invested in, and historically, that has not proven sufficient to always maintain a 1:1 backing. And also, I believe, not inconsistent with a description of "cash-like instruments" (at least insofar as any legal liability could result). Of course, the more you compare stablecoins to money market funds, the more you wonder why anyone should prefer the former over the latter: stablecoins appear to be a less regulated, more opaque version of money market funds, with more meager rewards and a richer repertoire of liars and scam artists.
- rglullis 4y agoAre you sure you are talking about Circle (USDC) and not Tether (USDT)? Let's not confuse one for the other, because I already said right at the top that Tether is not to be trusted.