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article imageCircle raises $110 M, plans to build USD-backed cryptocurrency

By Lisa Cumming     May 16, 2018 in Technology
Originally billed as a social payment company, Circle has been active on all fronts of digital currency — increasingly so in cryptocurrency. Their latest funding round success shows just how much, and where they plan to take their next step.
It's difficult to define Circle exactly, since the company does so much. Operating an investment platform, payment system, crypto exchange and, as TechCrunch reported, the "largest over-the-counter trading [desk] for big cryptocurrency investors and exchanges," Circle definitely has a hand in everything.
Setting funding records
Recently the company closed a funding round for $110 million that was led by Bitmain, a Bitcoin mining company. This deal pushes the value of the company to nearly $3 billion. According to Forbes, this round was the "largest venture capital round ever raised by a cryptocurrency or blockchain company."
Jumping on the Ethereum bandwagon
Following the close of the round, Circle said it would create a new cryptocurrency, that uses the Ethereum blockchain, with it's value "pegged to the price of the U.S. dollar," according to Reuters.
"A price-stable currency, such as a token pegged to the US dollar, is critical for enabling mainstream adoption of blockchain technology for payments as well as for supporting maturation in financial contracts built on smart contract platforms, such as tokenized securities, loans, and property. There are several interesting approaches to solving this need, spanning algorithmic reimaginations of money supply to crypto-backed tokens to fiat asset-backed tokens." — From a Circle press release.
This coin, called Circle USD Coin (USDC), is a "full reserve US dollar-backed stablecoin", Circle said in the aforementioned press release. The framework for this cryptocurrency is an "open source fiat stablecoin framework" that's been developed and is governed by CENTRE, a governed network for cryptocurrency. CENTRE, according to Circle, will be providing independent oversight of this new coin.
The effort is set to begin this summer, according to Bloomberg.
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