Is USDC the same as a US dollar in a bank?

No. USDC is a claim on Circle, backed by reserves Circle holds. It is not a bank deposit and deposit guarantee schemes do not cover it. Its value depends on the reserves and on Circle's ability to redeem tokens at par.

Is USDC allowed under MiCA?

Yes. Circle Internet Financial Europe SAS is authorised in France as an electronic money institution and appears in ESMA's interim register of e-money token white papers for USDC and EURC, with a notification date of 1 July 2024.

Can I redeem USDC directly with Circle?

Circle's own redemption service, Circle Mint, is open to institutions and not to individuals. Individuals usually sell USDC through an exchange or an off-ramp provider, which pays euros or dollars to a bank account.

Does USDC pay interest?

The token itself pays nothing. MiCA Article 50 bans issuers of e-money tokens and crypto-asset service providers from granting interest, or any benefit linked to how long you hold the token.

Which networks is USDC on?

Circle issues USDC natively on dozens of blockchains, including Ethereum, Solana, Base, Arbitrum, Polygon PoS and OP Mainnet. USDC on one network is a separate token from USDC on another, so the sender and receiver must use the same network.

How is USDC taxed in Bulgaria?

USDC is a crypto-asset under Bulgarian tax law. Gains and losses from selling it or exchanging it for another crypto-asset go into Annex 5 of the annual return, and the net result is taxed at 10% after a 10% statutory deduction.

USDC

By xChange.bg team
Published 16 September 2026

USDC is a digital dollar that lives on public blockchains. It is a stablecoin: its price is meant to stay at 1.00 US dollar because every token in circulation is matched by dollar assets held by its issuer, Circle.

How USDC works

When a business sends dollars to Circle through Circle Mint, Circle creates ("mints") the same number of USDC tokens. When a business returns USDC, Circle destroys ("burns") the tokens and pays out dollars. Circle Mint is open to institutions only. Individuals get USDC from exchanges, apps and on-ramp providers, which hold their own USDC inventory or mint through their Circle accounts.

According to Circle, USDC is backed 100% by cash and cash-equivalent assets. Most of the reserve sits in the Circle Reserve Fund, a US government money market fund managed by BlackRock and held in custody at BNY Mellon, with the rest in cash at regulated banks. A Big Four accounting firm checks the reserves every month and Circle publishes the reports. On 14 September 2026 Circle reported USD 74.2 billion of USDC in circulation.

USDC is issued natively on dozens of networks, including Ethereum, Solana, Base, Arbitrum, Polygon and Optimism. A USDC token on Solana and a USDC token on Base are both redeemable with Circle, but they cannot move directly between those networks. See blockchain network.

USDC under MiCA

In the EU, a stablecoin that tracks one official currency is an e-money token. Only an authorised bank or electronic money institution may offer one to the public. Circle Internet Financial Europe SAS, authorised by the French supervisor, issues both USDC and EURC as e-money tokens, and both are listed in ESMA's interim register.

That status brings concrete rules under MiCA:

Redemption at par. Holders have a claim on the issuer, which must redeem at any time at face value and without a fee (Article 49).
No interest. Neither the issuer nor a crypto-asset service provider may pay interest for holding the token (Article 50).
Reserve rules. Money received for tokens must be kept in bank deposits and secure, highly liquid assets in the same currency (Article 54).

Example

A designer in Plovdiv invoices a client in New York for USD 2,000. The client pays by wire into a USD account in the designer's own name. With xChange.bg, a technology provider whose accounts and conversions come from the regulated partner Bridge (a Stripe company), the incoming dollars convert to USDC in a self-custody wallet, with a 1.5% on-ramp fee: USD 30, leaving 1,970 USDC. The designer can hold the dollars, send them on-chain to a supplier, or sell them later to a euro bank account through an off-ramp.

Common confusion

USDC is not USDT. They are different tokens from different issuers with different reserve disclosures. See USDT.
"Redeemable 1:1" does not mean the market price is fixed. On exchanges USDC can trade slightly above or below 1.00, especially in stressed markets. Redemption at par is what pulls the price back.
USDC is a dollar asset. If you spend euros, the value of your USDC in euros moves with the EUR/USD exchange rate, even when USDC holds its dollar peg.

Frequently asked questions

Is USDC the same as a US dollar in a bank?: No. USDC is a claim on Circle, backed by reserves Circle holds. It is not a bank deposit and deposit guarantee schemes do not cover it. Its value depends on the reserves and on Circle's ability to redeem tokens at par.
Is USDC allowed under MiCA?: Yes. Circle Internet Financial Europe SAS is authorised in France as an electronic money institution and appears in ESMA's interim register of e-money token white papers for USDC and EURC, with a notification date of 1 July 2024.
Can I redeem USDC directly with Circle?: Circle's own redemption service, Circle Mint, is open to institutions and not to individuals. Individuals usually sell USDC through an exchange or an off-ramp provider, which pays euros or dollars to a bank account.
Does USDC pay interest?: The token itself pays nothing. MiCA Article 50 bans issuers of e-money tokens and crypto-asset service providers from granting interest, or any benefit linked to how long you hold the token.
Which networks is USDC on?: Circle issues USDC natively on dozens of blockchains, including Ethereum, Solana, Base, Arbitrum, Polygon PoS and OP Mainnet. USDC on one network is a separate token from USDC on another, so the sender and receiver must use the same network.
How is USDC taxed in Bulgaria?: USDC is a crypto-asset under Bulgarian tax law. Gains and losses from selling it or exchanging it for another crypto-asset go into Annex 5 of the annual return, and the net result is taxed at 10% after a 10% statutory deduction.