Fintech company Circle is looking make a better, faster, digital version of the U.S. dollar.
The Goldman Sachs-backed start-up announced a new cryptocurrency pegged to the dollar and a $110 million investment round led by profitable crypto-mining company Bitmain, which brings Circle's value near $3 billion, the company announced Tuesday.
"It unlocks an incredible amount of power for the dollar," said Jeremy Allaire, CEO of Circle. "It's basically a dollar that operates on blockchain."
Circle is one of the most well-funded blockchain start-ups, with investors including Goldman Sachs Group and Baidu. The fintech company operates its peer-to-peer payment network using blockchain, the technology that underpins bitcoin.
Circle's new USD Coin is meant to solve a key problem in digital currencies' use case: Volatility.
Critics including Stan Druckenmiller have said cryptocurrencies can't be used as a means of payment because their value changes so often and so rapidly. Bitcoin, for example, has been marked by volatility in the past 12 months and has dropped by more than 50 percent since its high near $20,000 in December, according to CoinDesk.
Circle customers will be required to hold $1 for every USD Coin, keeping the price stable. Other companies, such as Tether and Basis, also have offered "stable coins" with a value tied to the U.S. dollar. But Allaire said there's a need for a "compliant alternative" to Tether, which has a $2.2 billion market cap, according to CoinMarketCap.com.