The main distinctions between USDC on the Avalanche blockchain and USDC.e are outlined in this guide. Find out which stablecoin on the AVAX network has greater liquidity and lower smart contract risk.
What is USDC.e Vs USDC?
On the Avalanche blockchain, the currency symbol USDC.e stands for wrapped USDC tokens. The Ava Labs team first introduced the token to support the network’s development of liquidity, but they have since announced that it will soon be deprecated and that all liquidity will move to the native USDC token.
The Circle team, who developed USDC, is using its native USDC Coin on the Avalanche blockchain. These can be exchanged for US dollars directly on Circle’s exchange or on other websites like Coinbase.
Read More: Crypto Compare Guide 2023 – Exchanges, Wallets, Tokens & More
Key Differences Between USDC.e and USDC
You can choose which stablecoin to hold and use in Avalanche DeFi by comparing the main differences between USDC.e and USDC in the table below.
- Because USDC.e is a “wrapped” version of USDC, the risks associated with smart contracts have increased.
- Compared to native USDC on DeFi applications, USDC.e has less liquidity on the Avalanche blockchain.
- Due to the additional smart contract risk, USDC.e has higher yields than USDC.
- All liquidity will eventually be transferred to USDC after USDC.e is deprecated by the contract’s developers.
Overall, it is evident that USDC.e has more risk and fewer benefits than USDC. To reduce their stablecoin risks, investors are typically advised to hold USDC rather than USDC.e.
How to Swap USDC.e for USDC on AVAX
Use Platypus Finance, Avalanche’s largest stable swap, to exchange your USDC.e for USDC if you’re looking to do so. Compared to other DEX on the Avalanche blockchain, they offer the swaps with the lowest fee and the highest liquidity. You can follow the guide below to get started:
- Visit Platypus Finance
- Select ‘Swap’
- Select USDC.e as the token you have, and USDC as the token you want
- Input the amount of USDC.e you want to swap for USDC
- Execute your transaction and you will receive USDC instantly
Can I Redeem USD from Circle With USDC.e?
No, using USDC.e tokens to redeem USD directly from Circle or other services like Coinbase is not possible. This is due to the fact that they are Avalanche wrapped tokens and do not represent original USDC.
To exchange USDC.e, you must use a DEX like Platypus Finance, Trader Joe’s, or Pangolin.
How to Swap Between USDC.e and USDC
The good news is that switching between USDC.e and USDC or another token is relatively simple and easy.
Any of the popular AVAX DeFi platforms will support this swap, such as:
- TraderJoe
- Platypus Finance
- Pangolin
- ParaSwap
It is advised to use ParaSwap because it is a DeFi aggregator that finds and executes the swap routing option with the lowest fee. Utilizing ParaSwap can help you save time and money because, at any given time, specific DeFi platforms might have lower fees due to their liquidity and slippage.
Using ParaSwap to Swap USDC.e and USDC
Here is an example of using the ParaSwap platform to convert USDC.e to USDC.
- Go to ParaSwap.io
- Press Launch App
- Swap USDC.e with USDC on the Trade page
As you can see, PangolinSwap offered the best USDC.e to USDC exchange rate at the time this was written.
Can You Send USDC.e to An Exchange?
It’s crucial to understand that USDC.e and native USDC are two different things. Deposits in USDC.e are generally not accepted by exchanges. Therefore, before sending any USDC.e to an exchange, we advise that you convert it into USDC first.
If you do deposit USDC.e into a USDC address, the money might never reach your account. You must get in touch with the exchange’s customer service department, and any assistance will probably cost $20 to $50 USD.
Final Thoughts
As a wrapped form of USDC, USDC.e has lower liquidity and higher smart contract risk than native USDC on the Avalanche blockchain. To reduce your stablecoin risks when using DeFi applications on AVAX, we generally advise holding native USDC rather than USDC.e. Use Platypus Finance to quickly and easily exchange USDC.e for USDC with little slippage.
