Fidelity Investments is launching the Fidelity Digital Dollar (FIDD) stablecoin in early February to compete in the $308 billion stablecoin market dominated by Circle’s (NYSE:CRCL) USDC (CRYPTO: USDC) and Tether’s USDT (CRYPTO: USDT).

FIDD: How It Works

The stablecoin will be issued by Fidelity Digital Assets, a federally chartered national trust bank that received approval from the Office of the Comptroller of the Currency in December.

FIDD is pegged 1-to-1 to the U.S. dollar and backed by cash and short-term U.S. Treasuries.

For every FIDD token in circulation, Fidelity holds $1 in reserves—just like how Circle and Tether back their stablecoins.

The reserves comply with the GENIUS…

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