Circle started in 2014 as a peer-to-peer payments service based on Bitcoin, and has since then ventured further into the cryptocurrency space.
Circle is now the only member of CENTRE, but the company plans to lure in more firms in the near future.
Along with the new investment, Circle also announced that it would create a new cryptocurrency pegged to the price of the U.S. dollar, which is meant to solve a key problem in digital currencies' use case: volatility. The company offers a cryptocurrency investment service, a payment service that offers global transfers called Circle Pay, an over-the-counter service for cryptotrading called Circle Trade, and Polinex, the cryptocurrency exchange it acquired in February. Newcomer investors Blockchain Capital and Tusk Ventures have also contributed.
In February, it emerged that Circle had confirmed the purchase of US-based Poloniex in a deal estimated at $400m that would enable Circle to directly compete with one of the biggest cryptocurrency exchanges in the world, Coinbase.
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Circle's CEO Jeremy Allaire commented on the new cryptocurrency: "It is hard to use something like bitcoin if the volatility is so high". In conjunction with the investment of Bitmain technologies, it will be involved with the subsidiary of Circle (Centre) and help to launch digital currencies linked to other fiat currencies or legal tenders. The goal is to eventually have lots of stable tokens, all backed by different fiat currencies, but the first will be Circle USD Coin (USDC), a coin backed one-to-one by the US dollar with the fiat to be stored in an auditable bank account and redeemable by verified buyers.
Is Circle making the right moves? The new cryptocurrency, dubbed USD Coin, is a so-called "stablecoin" created to avoid the volatile price swings some cryptocurrencies have suffered from.
According to Circle though, the key difference between USDC and other fiat-based cryptocurrencies is that it plans to ensure regulatory compliance for its cryptocurrency.
Circle on Tuesday announced the pending availability of tokenized United States dollar coins, which is being supported by CENTRE and Bitmain. This new USDC will make digital tokens that much more appealing to the masses. "Bitmain will help Centre introduce multiple fiat stablecoins in a variety of geo-currency zones", Circle says.
Jeff Engel is a senior editor at Xconomy.