Bridged USD Coin Base (USDBC)

Use Cases of Bridged USD Coin Base

• Stablecoin Transactions on Base Network: Bridged USD Coin Base allows users to move USDC from Ethereum to the Base blockchain seamlessly, enabling stablecoin transactions on Base.

• Decentralized Finance (DeFi): It supports activities like trading, borrowing, lending, and liquidity provision on decentralized exchanges and DeFi platforms built on Base.

• Cross-Chain Compatibility: By bridging USDC to Base, it facilitates interoperability between Ethereum and Base, allowing users and developers to access USDC liquidity on Base without native issuance.

• Developer Ecosystem Support: It helps developers bootstrap stablecoin liquidity early on Base, enabling them to build applications that require a stable digital dollar.

• User Convenience: Users can deposit Bridged USD Coin Base to Coinbase and see it as USDC, simplifying balance tracking and asset management across networks.

• Transition to Native USDC: Bridged USD Coin Base serves as a temporary solution until native USDC is available on Base, allowing a smooth upgrade path without liquidity migration issues.

• Low-Cost Payments and Remittances: It enables fast, low-cost digital dollar payments and remittances on the Base network.

• On/Off-Ramps for Businesses: Businesses can convert fiat currency to USDC on Base easily, supporting digital dollar use in commerce.

Overall, Bridged USD Coin Base acts as a stable, interoperable digital dollar on the Base blockchain, supporting a wide range of financial activities and developer use cases until native USDC is fully adopted.

Advantages

Bridged USD Coin Base expands the utility of the original USD Coin by allowing it to be used across multiple blockchains, even those not directly supported by the original issuer. This means users can send, receive, and store stablecoins on various networks, saving time and money by avoiding intermediaries. It enhances interoperability and helps businesses reach more users by interacting with different USDC blockchains. Bridged USD Coin Base is compatible with Coinbase, allowing seamless transfers and balance tracking within the Coinbase ecosystem. It also plays a key role in jumpstarting activity on new blockchain networks and can be upgraded to native USDC in the future without complex migrations.

Disadvantages

Bridged USD Coin Base can cause liquidity fragmentation because different versions of USDC exist on various blockchains, which may split liquidity and create infungibility issues. The security of bridged tokens depends on the bridge protocols, which can be a potential point of failure if compromised. Bridging transactions may take time (sometimes hours or days) and involve network fees. Additionally, only native USDC is generally supported for direct redemption by Circle, so bridged tokens may have limitations in that regard.

Founders of Bridged USD Coin Base

Bridged USD Coin Base was founded by Jeremy Allaire and Sean Neville. They are also the co-founders of Circle, a company established in 2013 that created the original USD Coin (USDC). Jeremy Allaire has a background in technology and entrepreneurship and has played a key role in shaping Circle's vision for a more open and inclusive financial system. Bridged USD Coin Base is a bridged version of USDC designed for use on the Base blockchain network, which is incubated within Coinbase.

Investors in Bridged USD Coin Base

Bridged USD Coin Base is closely linked to the Centre consortium, which includes Coinbase and Circle. These are regulated financial institutions that back the original USD Coin (USDC) with real dollars. Coinbase has deployed Bridged USD Coin Base (USDbC) on the Base blockchain, which is incubated within Coinbase. This means the main investors and supporters behind Bridged USD Coin Base are:

• Coinbase: The leading crypto exchange that developed the Base network and deployed USDbC.
• Circle: A regulated financial institution that issues the original USDC and supports its bridged versions.
• Centre Consortium: The group behind USDC, including Coinbase and Circle, ensuring trust and backing.

These entities provide the financial and technical foundation for Bridged USD Coin Base, making them the primary investors and backers of this token.

Halal Status of Bridged USD Coin Base

• Halal or Not: No
• Reason: Bridged USD Coin Base is a stablecoin pegged to the US dollar and involves mechanisms similar to interest-based earnings, which are generally considered not halal in Islamic finance. Discussions around USDC yield suggest it resembles interest, making it not compliant with halal investment principles.