Aave Avalanche Market USDC


avUSDC is an interest-accruing token that represents a USDC.e deposit in the Aave lending market.

Risk Rating
What we like
avUSDC is an interest-accruing version of USDC. USDC provides easy on-ramp and off-ramp to convert your USD into digital dollars that are backed 1:1 by underlying reserves.
What we like less
avUSDC is exposed to systemic risk of other assets on the Aave lending platform. USDC also has greater centralization as Circle custodies the deposited USD and controls the minting and redemption of USDC.
What it means for you
avUSDC offers you a great way to earn yield on your USD, while maintaining exposure to a highly liquid instrument to hedge your portfolio in volatile market conditions.
  • Avalanche
Key Metrics
  • Total Supply: 573,214,949
  • ATH: $1.16 (05/19/2021)
  • ATL: $0.88 (03/11/2023)
Risk Assessment
Asset Strength

avUSDC is a large-cap, fully collateralized asset. This asset depends on a centralized entity for custody services. This asset is exposed to the underlying risks of Avalanche bridge and Aave, which are protocols rated as Risky and Best in Class, respectively. avUSDC is a receipt of a USDC.e deposit in the Aave lending protocol and accrues interest. USDC.e on Avalanche is backed 1:1 by USDC locked in the Avalanche bridge on the Ethereum chain. The asset has an uncapped supply but has inflation control or burn mechanisms in place.

avUSDC is a stablecoin that usually trades within 20bps of its peg to USD, which makes it a solid store of value.

Asset Volatility

avUSDC is a stablecoin that usually trades within 20bps of its peg to USD, which makes it a solid store of value.


Aave V3

Avalanche Bridge

Things to know about avUSDC

Who invented USDC?

USDC launched on the Ethereum mainnet in September 2018 as a partnership between Circle and Coinbase through the co-founding of the CENTRE Consortium. Customers on Coinbase with USD accounts can exchange 1 USDC for 1 USD and vice versa. USDC is issued by financial institutions and established fintech firms that have met its membership criteria.

How does avUSDC work?

avUSDC is a receipt of a USDC deposit in the Aave V2 protocol on Avalanche and accrues interest. USDC is backed 1:1 by USD reserves held with a licensed custodian (Circle). The process of minting USDC tokens involves interacting with CENTRE contracts which manage the minting and burning of USDC. First, a user sends USD to a licensed token issuer's bank account. Second, the issuer uses the USDC smart contract to mint an equivalent amount of USDC. Third, the newly created USDC is sent to the user's on-chain address, while the deposited USD is held in reserve. The process for redeeming USDC for USD is just the reverse process.

How secure is avUSDC?

avUSDC is exposed to the systemic risks of the Aave lending protocol as a default in one asset market can have a contagion effect across the entire platform. USDC is a centralized stablecoin that is perceived as safer and more transparent than USDT as its reserve composition only consists of cash and short-term U.S. government bonds. USDC regularly undergoes audits and publishes monthly reserve reports and attestations that prove the number of USD reserves is greater than the amount of USDC in circulation. Nonetheless, USDC can "blacklist" any of its associated addresses at will. When a USDC address is blacklisted, it can no longer receive USDC and all of the USDC controlled by the address can no longer be transferred on-chain.