Coinbase Crypto Exchange Buys Stake in USDC Stablecoin-Issuer Circle – Here's What You Need to Know

cryptonews.com:

According to Circle's blog post released on August 21, Cryptocurrency exchange Coinbase has bought a minority stake in Circle Internet Financial while dissolving their Centre Consortium partnership that had issued USD Coin (USDC), the world's second-largest stablecoin.

In the jointly authored blog post, Circle CEO Jeremy Allaire and Coinbase CEO Brian Armstrong said, "Circle and Coinbase, the founding companies behind Centre Consortium, a jointly managed self-governance consortium for USDC, have agreed that with growing regulatory clarity for stablecoins in the U.S. and around the world, the requirement of a separate governance body like Centre is no longer needed. Centre will no longer exist as a stand-alone entity, and Circle will remain the issuer of USDC, bringing any Centre governance and operations responsibilities in-house."

Introduced in 2018, USDC is tethered to the value of the U.S. dollar, ensuring a steady price of $1 through reserves composed of dollar-equivalent assets.

Although Circle conceived the initial concept, the company established an autonomous consortium called Centre to oversee the token.

In collaboration with Coinbase, which took on the role of distribution partner, USDC was successfully launched in October 2018. While dissolving the Centre Consortium, they announced a new partnership.

"As part of this next chapter, Coinbase and Circle have reached a new agreement. Reflecting Coinbase's belief in the fundamental importance of stablecoins to the broader crypto economy, Coinbase is taking an equity stake in Circle."

While Jeremy and Brian didn't reveal the exact amount of the equity investment, Jeremy referred to it as a "minority equity stake."

However, an insider mentioned that Coinbase didn't provide