This is great research/writeup. One thing to consider though; Circle does actually have the ability to freeze any of the USDC on Ethereum (roughly 85% of all USDC in circulation) and I'd imagine they have the ability to the same on the other chains. As I understand it, the ERC-20 token contract is freeze-enabled. So essentially, when Circle (or any government nudging entity) decides a wallet address that is using USDC is up to no good, that USDC can be frozen. I believe Circle actually blacklisted quite a few ETH addresses in response to OFAC/Tornado Cash. Tether did as well for what it's worth... The point is, Circle may not be freezing to a large degree yet, but there is considerable risk in doing illegal shit with USDC.
The Fed doesn’t want a competitor. It’s currently the sole issuer of untraceable bearer dollars (federal reserve notes). USDC is a threat to the Fed’s power.
Was hoping for an article about this! Curious what your response would be to people who say 1. there's no expectation of profit when you mint a stablecoin and therefore they aren't securities and 2. cash can be used without government oversight as well so why should they know how every dollar of stablecoin is spent.
Stablecoin Shadow Banks
Great piece
thank you for your time on this, much appreciated.
This is great research/writeup. One thing to consider though; Circle does actually have the ability to freeze any of the USDC on Ethereum (roughly 85% of all USDC in circulation) and I'd imagine they have the ability to the same on the other chains. As I understand it, the ERC-20 token contract is freeze-enabled. So essentially, when Circle (or any government nudging entity) decides a wallet address that is using USDC is up to no good, that USDC can be frozen. I believe Circle actually blacklisted quite a few ETH addresses in response to OFAC/Tornado Cash. Tether did as well for what it's worth... The point is, Circle may not be freezing to a large degree yet, but there is considerable risk in doing illegal shit with USDC.
very interesting
The Fed doesn’t want a competitor. It’s currently the sole issuer of untraceable bearer dollars (federal reserve notes). USDC is a threat to the Fed’s power.
Was hoping for an article about this! Curious what your response would be to people who say 1. there's no expectation of profit when you mint a stablecoin and therefore they aren't securities and 2. cash can be used without government oversight as well so why should they know how every dollar of stablecoin is spent.
Crazy times. Wonder what Stable coin one should use if all going to blow up.