That said the damn thing does have legs and continually fills coffers for many people. The ripple effects of a potential crash should be interesting. If I was stuck in Afganistan I rather have a bag of diamonds, gold or USD than my cold wallet or even access to my accounts on an exchange. The sole purpose of stablecoins is to facilitate money laundering.
What constitutes a stablecoin’s reserves is important. What sets them apart from other cryptocurrencies is the fact they’re pegged to an existing currency like the U.S. dollar or the euro. Digital currency company Circle says it’s changing the makeup of its dollar-pegged stablecoin USD Coin to just cash and U.S. Now, Circle says it’s changing the makeup of USD Coin’s reserves once again, with just cash and U.S. In July, it was revealed this was no longer the case, with Circle disclosing in an “attestation” from auditors Grant Thornton that cash made up just over 60% of USD Coin’s reserves. The other 40% was backed by various forms of debt securities and bonds.
The aim is to avoid the volatility often found in bitcoin and other major cryptocurrencies. What sets them apart from other cryptocurrencies is the fact they’re pegged to an existing currency like the U.S. dollar or the euro. Earlier this year, tether’s issuer revealed that just 2.9% of its reserves were held in cash. The vast majority of its reserves were made up of commercial paper, a form of unsecured, short-term debt that’s riskier than government bonds. Digital currency company Circle says it’s changing the makeup of its dollar-pegged stablecoin USD Coin to just cash and U.S. Digital currency company Circle says it’s changing the makeup of its dollar-pegged stablecoin’s reserves to just cash and U.S.
[wikipedia.org] That way it has consistent buying power, and a minimal incentive to hold it for long periods of time. The derivative market is just as much an inherently unstable casino as cryptocurrency. The beauty of this line is that it could apply equally to people who post useless complaints or to people who think Bitcoin is useful as a currency. Supposed to be fiat currency tokenized on a blockchain, merely for ease of use, speed of transfer, etc⦠also for the interest accrued when holding on exchanges. If I buy a stock for $1 and its value rises to $2, if I trade that stock for another stock worth $2 then it’s a taxable event and I would owe capital gains tax on the $1 in gains.
The world’s second-largest stablecoin is undergoing a massive change
Barter transactions are taxable, otherwise Bill Gates would just trade his Microsoft stock for Berkshire stock and incur no taxes. On Sunday, Centre it was “deepening its commitment to transparency” and “exploring new opportunities to collaborate with the community.” USDC to Be Backed 100% by Cash, US Treasuries From September – CoindeskThe USDC developer revealed last month that only 61% of tokens were backed by “cash and cash equivalents.”
Centre, a consortium that developed the stablecoin and was founded by Circle and crypto exchange Coinbase, unveiled the change Sunday. Centre clarifies USDC reserves composition, citing ‘regulatory landscape’ – AMBCryptoUSD Coin’s recent growth has become an important aspect of the digital currency-enabled financial system. It has always been fully backed by reserves equal to or greater than the USDC in circulation, giving users the ability to always redeem 1 USD Coin for $1.00. The post Circle Reverts to More Conservative Investment Profile for USDC Reserves appeared first on BeInCrypto.
Tax is payable whenever u sell or exchange a crypto. That means changing to USDC from another crypto is a taxable event. As far as I can tell it’s just a way to defer taxes on crypto. IMHO the exchanges support them because it helps to encourage active trading. There are increasing calls for stablecoin issuers to provide frequent breakdowns of their reserve compositions to address opaqueness in fast-growing crypto industry.
Centre, a consortium founded by Circle and crypto exchange Coinbase which developed the stablecoin, unveiled the change on Sunday. “These changes are being implemented expeditiously and will be reflected in future attestations by Grant Thornton.” What constitutes a stablecoin’s reserves is important. What sets them apart from other cryptocurrencies is the fact that they’re pegged to an existing currency like the U.S. dollar or the euro.
Zelle transfers require a bank account , are limited in size (varies by bank, maybe $2k/day), and are limited to the US. So you can’t use it for international payments, such as sending remittances.
That need to “eliminate the bank as a middle man” is because banks will not deal with shady exchanges allowing anonymous, unregulated trading in violation of the laws in many countries. It’s one of the things Tether was required to do as part of an $18.5 million settlement with James’ office. Tether, the largest stablecoin with $75 billion in circulation, has drawn scrutiny from regulators amid fears it doesn’t have enough assets to support its peg to the greenback. Many crypto traders use stablecoins as an alternative to their bank, to buy or sell digital currencies. Which developed the stablecoin, unveiled the change on Sunday.
Fed Chairman Jerome Powell has previously said a U.S. central bank digital currency could eliminate the need for cryptocurrencies and stablecoins like USDC and tether. Earlier this year, tether’s issuer revealed that just 2.9% of its reserves were held in cash. The vast majority of its reserves were made up of commercial paper, a form of unsecured, short-term debt that’s riskier than government bonds. In July, it was revealed this was no longer the case, with Circle disclosing in an “attestation” from auditors Grant Thornton that cash made up just over 60% of USD Coin’s reserves.
It also requires less thought than the stock market. If you exchange virtual currency held as a capital asset for other property, including for goods or for another virtual currency, you will recognize a capital gain or loss. For more information on capital gains and capital losses, see Publication 544, Sales and Other Dispositions of Assets.
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USD Coin is the second-largest stablecoin globally, with $27 billion worth of coins in circulation. All articles, images, product names, logos, and brands are property of their respective owners. All company, product and service names used in this website are for identification purposes only.
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USDC reserves will be reversed to cash and US treasuries only – The BlockStarting in September, the reserves for the USDC crypto stablecoin will be held entirely in cash and short duration US Treasuries. The post USDC reserves will be reversed to cash and US treasuries only appeared first on The Block. Centre, a consortium that developed the stablecoin and was founded by Circle and crypto exchange Coinbase unveiled the change Sunday. Now, Circle says it’s changing the makeup of USD Coin’s reserves once again, with just cash and U.S.
Use of these names, logos, and brands does not imply endorsement unless specified. By using this site, you agree to the Terms of Use and Privacy Policy. And, if people had two ounces of common sense, this should be already reflected on its market value. But apparently a blockchain USD is in so high demand that everyone is entirely happy with being sold something, and then told at which price to sell that same thing back. Just more of a space travel / LHC / genetic vaccine / neurotherapy kind, and less of a organized crime / financial market / politics / warfare kind. To make it useful as a currency it should be pegged to the Consumer Price Index.
Trading
This is why we need algorithmically backed stablecoins. I don’t want to have to trust a third party institution that my money is secure. Subreddit dedicated to the news and discussions about the creation and use of technology and its surrounding issues.
This sparked fears that a sudden mass redemption of tether tokens could destabilize short-term credit markets. Coinbase Removes USD Coin ”Backed By Dollar” Statement – NewsBTCTether now has an advantage over USD Coin . As a result, Circle’s dollar-pegged stablecoin, USDC, lost one of its largest leveraging stances to its main competitor, USDT. I basically use them as a riskier savings account with a significantly higher APY.
New York Attorney General Letitia James said Tether, the company behind the stablecoin of the same name, should submit quarterly transparency reports. It’s one of the things Tether was required to do as part of an $18.5 million settlement with James’ office. Tether, the largest stablecoin with $75 billion in circulation, has drawn scrutiny from regulators amid fears it doesn’t have enough assets to support its peg to the greenback. Scary times when so many financially illiterate folks are now instantaneously investment gurus.
By converting BTC to USDC/USDT or similar, you’re effectively able to operate in something that looks like USD, but it is not – and since there’s no hard currency exchange, it is not a taxable event. No, takes are payable when you buy and sell stuff – as in, for real money. The IRS doesn’t if you convert your Bitcoin to USDC on some random exchange, but they sure do care if you try to cash out on the latter. Both Tether and Circle have since released reports breaking down their reserves. In their latest policy meeting, officials at the U.S. Federal Reserve said stablecoins should be regulated as they pose a potential threat to financial stability.
The growth of stock combined with the liquidity of currency. If you don’t know what that means, you have no business posting here. In your defense, the situation you described could have been described as a like-kind exchange which did not trigger tax liability. I’ve heard this version quite a few times as to why to avoid US Dollars. It seemed inconsistent with how other things worked, but crypto is pretty weird. Tax shenanigans are a hassle I don’t need, but that’s certainly the line I’ve been fed on why you’d use a stablecoin.