Cardano Launches USDCx Stablecoin Backed by Circle’s USDC, ADA 3% Down

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Cardano has launched its native USDCx stablecoin, backed 1:1 by Circle’s USDC stablecoin via Circle’s xReserve smart contract. 

According to the Input Output Group (IOG), the research and engineering organization behind Cardano, USDCx will “make moving and using dollar value across supported blockchains seamless, providing streamlined access to cross-chain USDC liquidity.” This will effectively support DeFi liquidity provision, lending, and payments, in addition to real-world asset (RWA) settlement on the blockchain.

Cardano launches USDC-backed USDCx stablecoin

USDCx was developed by the community-funded Critical Integrations program in conjunction with Pentad and Midgard Labs. With its debut, Cardano is now one among several other networks utilizing stablecoin-on-stablecoin backing, including Sky Protocol (formerly MakerDAO) and Frax Finance. 

For the first 10 days following its launch, IOG will subsidize bridge fees for transferring USDCx to Cardano in order to foster initial adoption. Users will however, be responsible for their all other network and DEX fees, but without any third-party contracts.

ADA recent developments and price action

At press time, ADA was the 10th largest cryptocurrency with a market cap of over $10 billion. The coin was trading at $0.2775, down 2.87% in the last day, and 91% below its September 2021 all-time high of $3.09.

Despite the recent development, ADA is yet to register any positive price change due to bearish market-wide sentiment.

Source: CoinMarketCap

That said, the token has seen notable uptake by whales and institutional figures such as Grayscale. ADA futures’ open interest has surged by almost 30% this month, indicating renewed institutional interest despite broader market volatility.

Similar to Ethereum, Cardano plans on offering a regulatory-compliant and privacy-focused sidechain for institutions. Other upcoming developments comprise scalability, cost-effectiveness, and community governance.