What is USDC
USDC or USD Coin is a fully-reserved stablecoin, which is a type of cryptocurrency. Unlike other cryptocurrencies that fluctuate in price, USDC is designed to maintain price equivalence to the U.S. dollar. USDC is a stable store of value that benefits from the speed and security of blockchain technology. Read more: circle.com/en/usdc.
Instructions and Best Practices
Step 1. Open a crypto wallet on the Ethereum Main Network which can accept ERC-20 tokens (ie. USDC)
For individuals: Creating a wallet on Coinbase is what we recommend for individuals. This is an easier withdrawal process and is a good option if you don’t plan to hold onto crypto long term.
For organizations: Creating an account on Coinbase Commerce (1% fee) is what we recommend for those who own an organization or business, as it enables you to automatically convert USDC to fiat, simplifying accounting. If you are a US-based institution and worried about compliance, our funder recommends reaching out to Coinbase’s dedicated institutional team who can walk you through the process. They are very responsive.
Metamask is what PLRC uses, along with Gnosis Safe as an added security layer and multi-signature capabilities (do I need this?). As it takes more time and coordination to set up, we only recommend it to teams more familiar with transactions in crypto and see a benefit in sharing access to funds and holding amounts in USDC.
Once you’ve set up a wallet, please save your wallet address as a means to receive funds. An address should look something like this: 0xdc0dFEe711771839471281B2b8a1cc0A0A7ac1f3
Step 2. Once the USDC is received, Convert USDC to the currency needed (ie. USD/pound) on an exchange
- Coinbase has a built-in exchange that is easy to use, and Coinbase Commerce can automatically convert upon receipt
- If you are not using a wallet that has an exchange service, sign up on an exchange platform like Kraken and, if needed, complete their ID verification process. Then transfer the amount from your wallet onto your exchange account in order to trade USDC into the currency of your choice. Always double check the wallet addresses and amounts when trading on an exchange.
- All transfers between cryptocurrency accounts are subject to a gas fee in Ethereum. ETH gas fluctuates based on the market. We have paid anywhere from $2-$60.
- Exchanges between currencies are subjected to trading fees, which are tiered based (cheaper when you exchange more). It’s recommended to convert amounts all at once if you know that you will not keep USDC on the exchange. As USDC is pegged to USD, it does not fluctuate like other cryptocurrencies.
Step 3. Withdraw from exchange to you/your org’s bank account
- There is typically an ID verification process when making a withdrawal. This can take a few days to approve and it is done as an industry standard for anti-money laundering purposes.
- There may be a withdrawal fee applied as a flat fee or a small percentage of the total amount.
- On the bank’s side, it will take additional time and wire fees for the transfer to go through.
Tiered fees for using Coinbase:
0.18% – 0.60%
Exchange fees when converting USDC to Fiat:
0.0% – 1.0%
Withdrawal fee to bank:
Depending on the platform, this is usually a flat fee (i.e. $30). We have also seen white glove services charge between 0.5%-2%
Transfer fee between crypto wallets (gas fees):
Dependent on the market. We have paid anywhere between $2-$60