Before the advent of stablecoins, crypto traders turned to Bitcoin (BTC) as a “quote currency”. BTC’s volatility, however, has proven to be undesirable for professional traders. The only other alternative was to link their bank account to exchanges and trade fiat-to-crypto. Slow wire transfers and high fees were a persistent problem. Today, thanks to stablecoins, traders have the ability to enter and exit crypto using fiat currency in the form of a token. OVEX has now added a new stablecoin to its highly liquid exchange, USDC.
Crypto OTC offices, like OVEX’s, use stablecoins for three main reasons: as trading capital; as quote currency; and as a counterparty settlement instrument. In the past, OVEX reserved USDC transactions for its OTC clients only. Now it is available to all OVEX exchange users! Enabling small volume traders to harness the power of OVEX’s high liquidity with the click of a button.
Click here to buy and sell USD coins on OVEX today.
Because the USDC is tied 1: 1 to the US dollar; it has proven popular among South African crypto arbitrageurs. According to OVEX chief trading officer Tom Masojada, a substantial amount of client transaction volumes through the OVEX OTC office are switching hands with the USDC to take advantage of the crypto arbitrage premium:
“OVEX customers can now sell USDC directly for Rands at the same local premium that Bitcoin is trading at – with tight spreads and zero fees. We specialize in the best prices on high volume transactions ”
It’s a game changer. Before OVEX, this process was expensive and time consuming:
We would buy USDC with dollars. This USDC was then sent to an offshore crypto exchange and used to buy Bitcoin. This Bitcoin was then sent to a local exchange, like Luno, and sold for Rands at a profit. Add volume to the mix and executing a transaction of this nature becomes even more complicated.
With OVEX, you can sell USDC, by volume, directly for Rands through their OTC office
What exactly is the USDC (USDC) coin?
USDC is one of the world’s fastest growing regulated digital dollar stablecoins – issued by payments giant, Circle. At the time of writing this article, USDC 29.4 billion fully secured is outstanding. Hundreds of companies support the USDC standard including: digital wallets, exchanges, DeFi protocols, savings, loan and payment services.
What are USD stablecoins like USDC used for?
Stablecoins allow investors to generate a return on their crypto assets in the decentralized finance (DeFi) space while simultaneously mitigating the adverse effects of market volatility.. This is precisely why OVEX offers cryptocurrency interest accounts, where you can safely store your USDC and generate an impressive 9% annualized return. This approach is popular for investors looking for a higher return than that offered in traditional fixed income investments (such as savings accounts, money market funds or bonds). Many seasoned cryptocurrency investors “place” their cryptocurrency profits into high-yield, low-risk USD stable protocols of this nature.
Click here to open a crypto interest account with OVEX and start earning passive income today.
In general, stable coins like USDC are used for:
- Reduce crypto exposure without ever cashing in completely;
- Monetize DeFi and generate returns unmatched in traditional finance;
- Avoid traditional financial instruments and intermediaries;
- Hedge against hyperinflation (especially for people living in countries like Venezuela or Turkey);
- Send money instantly, globally, securely and at low cost; and
- Buy items in various blockchain-based crypto dApps, exchanges, and games.
Asset managers have turned to USDC as a hedge against rand volatility. Especially in the wake of the Chinese real estate developer, the looming debt crisis of Evergrande. Last week, the MSCI Emerging Market Currency Index fell 1.44% to a three-week low, with the rand falling 1.52% to 14.795 leading the pack. The fallout from this crisis in emerging markets, such as South Africa, worries investors about the future stability of the rand.
Click here to buy and sell USD coins with your South African rand.