USDC

After Circle disclosed how much of its USDC stablecoin is backed by reserves held by Silicon Valley Bank, exchanges show caution signs.

“Like other customers and depositors who relied on SVB for banking services, Circle joins calls for continuity of this important bank in the U.S. Finally, late on Friday night, Circle disclosed that $3.3 billion worth of the cash backing USDC remains locked in Silicon Valley Bank. (USDC was originally launched by Centre, a joint venture between Coinbase and Circle) [tweeted](https://twitter.com/circle/status/1634391708837330945?s=20). The firm said Silicon Valley Bank is one of six banks Circle uses for managing 25% of USDC reserves. Top cryptocurrency exchanges Binance and Coinbase both said on Friday night that they would temporarily suspend USDC conversions as the contagion from the collapse of

USDC lost 3% of its value as it traded at $0.969, while on-chain data further reveals that Circle redeemed a net of $1.4 billion in USDC in 8 hours.

During the timeline, Circle’s chief financial officer Jeremy Fox-Geen had shared their intent to go public but planned on waiting for better market conditions. At the time of writing, USDC lost 3% of its value as it traded at $0.969. 2/ Like other customers and depositors who relied on SVB for banking services, Circle joins calls for continuity of this important bank in the U.S. However, two days later, on March 11, Circle confirmed that the wire transfers were not completely processed and that $3.3 billion of the USDC reserves was still with SVB. In an effort to reduce exposure, crypto companies including Coinbase and Jump Trading redeemed approximately $850 million and upto $138 million in USDC. “As with Silvergate, our teams have worked at speed to limit any exposure to banks.

Circle earlier confirmed it has $3.3 billion backing its USDC stablecoin parked at now-shuttered Silicon Valley Bank.

CoinDesk is an independent operating subsidiary of [Digital Currency Group](https://dcg.co/), which invests in [cryptocurrencies](https://dcg.co/#digital-assets-portfolio) and blockchain [startups](https://dcg.co/portfolio/). [ Consensus 2023](https://consensus.coindesk.com/), CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. The fate of that cash is now uncertain, with Silicon Valley Bank having been seized by the FDIC, and USDC – for the moment – [has lost its dollar peg](https://www.coindesk.com/markets/2023/03/11/usdc-stablecoin-depegs-from-1-circle-says-operations-are-normal/). [strict set of editorial policies](/ethics/). "Silicon Valley Bank is a critical bank in the U.S. Speculating on the stability of USDC, traders redeemed $1.6 billion of USDC, lowering its total supply.

Circle Internet Financial's USDC stablecoin, which is the second-largest stablecoin at $42 billion of market cap, depegged from the U.S. dollar as contagion ...

Contagion from the shuttering of Silicon Valley Bank (NASDAQ: SIVB) continues to hit the markets, with the latest impact being felt by Circle, whom revealed ...

The author has no securities or affiliations related to this organization. The author holds no licenses. The development was released by the exchange via Twitter.

While the crypto market responded with a massive sell-off, not all USDC investors were lucky enough to walk away with their funds amid the uncertainty.

He explained the nuances that eventually led to a maximal extractable value (MEV) bot netting $2.045 million in profit after paying $45 in gas and $39,000 in MEV bribes. On-chain investigations revealed that the user had stored the assets in a liquidity pool (LP) — a popular method to earn passive income in cryptocurrencies. [Silicon Valley Bank did not transfer $3.3 billion](https://cointelegraph.com/news/circle-discloses-3-3b-tied-up-at-silicon-valley-bank) of its USD Coin ( [USDC](https://cointelegraph.com/usdc-price-index)) reserves, the market responded with a massive sell-off — [depegging the stablecoin](https://cointelegraph.com/news/usdc-depegs-as-circle-confirms-3-3b-stuck-with-silicon-valley-bank) from the U.S. The user could have sold his LP tokens for USDT for a 6% slippage. Not all of them are going to make it there in one piece, however.— BowTiedPickle.eth With USDC insolvency fears rampant, users are fleeing to safety in other stables.

Other popular cryptocurrencies, such as Tether (USDT) and Binance USD (BUSD), continue to maintain a 1:1 peg with the US dollar.

[DAI](https://cointelegraph.com/dai-price-index)), a stablecoin issued by MakerDAO, lost 7.4% of its value due to USDC’s depegging. [USDC](https://cointelegraph.com/usdc-price-index)) depegged from the U.S. dollar due to a [subsequent sell-off](https://cointelegraph.com/news/usdc-depegs-as-circle-confirms-3-3b-stuck-with-silicon-valley-bank) after Silicon Valley Bank (SVB) [did not process](https://cointelegraph.com/news/circle-discloses-3-3b-tied-up-at-silicon-valley-bank) $3.3 billion of Circle’s $40 million transfer request. SVB was shut down by the California Department of Financial Protection and Innovation for undisclosed reasons. USDD responded to the USDC sell-off with a nearly 7.5% drop to trade at $0.925, while FRAX dipped even further to $0.885. As a result, DAI depegged from the dollar to momentarily touch $0.897.

Volatility is expected to continue throughout the weekend as panic sets in after the Silicon Valley Bank collapse. The failure of SVB is hurting the reserve ...

Ket to that will be if a buyer of the bank can be found. [Peter Thiel's Founders Fund advised depositors to get out](https://www.bloomberg.com/news/articles/2023-03-11/thiel-s-founders-fund-withdrew-millions-from-silicon-valley-bank), which was the nail in the coffin for SVB – bank runs are hard to stop. The transaction ended up costing $2,080,468.85 to receive $0.05 of USDT: DAI is the fourth-largest stablecoin. The Fed putting up interest rates means the value of bonds falls, because bond yields and price have an inverse relationship. This is common practice in the fractional banking model that underpins modern banking. Traders and crypto firms reacted to the news of USDC reserve exposure to SVB by exiting their positions in the stablecoin and moving into USDC has $3.3 billion tied up at SVB. USDC and DAI in trouble – which of the top stablecoins are at risk? USDC is the second-largest stablecoin in the crypto ecosystem and is an essential part of the industry's plumbing. [FDIC the receiver](https://www.fdic.gov/news/press-releases/2023/pr23016.html) – after depositors initiated a run on the bank by trying to withdraw as much as $45 billion on Thursday. The failure of SVB is hurting the reserve position of

Stablecoin issuer Circle held an undisclosed amount of USDC's cash reserves at failed Silicon Valley Bank.

LONDON, March 11 (Reuters) - By Elizabeth Howcroft and Rishabh Jaiswal. Stablecoin USD Coin (USDC) lost its dollar peg and slumped to an all-time low on ...

The largest, Tether, has a market cap of $72 billion, according to CoinGecko. USDC is the second-biggest stablecoin with a market cap of $37 billion. Stablecoin USD Coin (USDC) lost its dollar peg and slumped to an all-time low on Saturday after Circle, the U.S. bank failure since the 2008 financial crisis, roiling global markets and stranding billions of dollars belonging to companies and investors. USDC's price usually holds close to $1, making Saturday's drop unprecedented. It recovered slightly to trade around $0.90 by 1120 GMT.

USDC, the stablecoin tracing the USD, is under immense pressure as users rush to convert to other assets, including BUSD by Paxos and USDT by Tether ...

During periods of heightened activity, conversions rely on USD transfers from the banks that clear during normal banking hours. The Each USDC token, it should be noted, is backed 1:1 with cash, and redemption means every backing cash or cash equivalent from Circle must be sold and disbursed to the client. The loss will likely be covered by interest payments from treasuries, where most of Circle’s assets are held in. What’s on the table currently is USDC by Circle. [trading](https://coinmarketcap.com/currencies/usd-coin/) at $0.90 to the USD at the time of writing on March 11.

Some $4 million in USDC futures were liquidated in the past 24 hours, Coinglass data shows.

[ Consensus 2023](https://consensus.coindesk.com/), CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. CoinDesk is an independent operating subsidiary of [Digital Currency Group](https://dcg.co/), which invests in [cryptocurrencies](https://dcg.co/#digital-assets-portfolio) and blockchain [startups](https://dcg.co/portfolio/). [strict set of editorial policies](/ethics/). As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of [stock appreciation rights](https://www.investopedia.com/terms/s/sar.asp), which vest over a multi-year period. The funding was paid by traders who shorted USDC, paying over 0.4% to borrow the asset and bet on lower prices. Leverage could potentially magnify returns for traders betting on a recovery.

Issuer Circle Internet Financial said it held a chunk of its reserves at the failed bank, while the token's price fell below a dollar.

[said](https://twitter.com/circle/status/1634391505988206592) $3.3 billion of its token’s $40 billion in reserves were at the bank, which regulators [shut down](https://www.barrons.com/articles/svb-financial-stock-portfolio-outlook-loss-93287f3d?mod=hp_LEAD_1&mod=article_inline) earlier in the day. One of the most important underpinnings of the cryptocurrency market appears to be on shaky ground, as stablecoin issuer Circle Internet Financial disclosed that a significant portion of its reserves are locked up at the failed Silicon Valley Bank and the token struggled to maintain its dollar peg. Stablecoin USDC, Part of Crypto’s Bedrock, Is Caught in Failed Silicon Valley Bank

The U.S. cryptocurrency firm Circle's USD Coin lost its dollar peg and fell to a record low Saturday morning.

banking failure](https://www.cnbc.com/2023/03/10/silicon-valley-bank-collapse-how-it-happened.html) since the 2008 financial crisis. The company's spectacular implosion began late Wednesday when it surprised investors with news that it needed to raise [$2.25 billion](https://www.cnbc.com/2023/03/10/silicon-valley-bank-is-shut-down-by-regulators-fdic-to-protect-insured-deposits.html) to shore up its balance sheet. [shuttered](https://www.cnbc.com/2023/03/10/silicon-valley-bank-is-shut-down-by-regulators-fdic-to-protect-insured-deposits.html) SVB Friday and seized its deposits in what has become the [largest U.S. In a tweet Friday, Circle said it has $3.3 billion in remaining reserves at SVB. USDC is designed to trade at $1, but it fell below 87 cents on Saturday, according to data from CoinDesk. The U.S.

The depegging of the USDC stablecoin has affected other stablecoins, wreaking havoc on crypto projects and stakeholders in a massive chain reaction.

In an update, KyberSwap, the decentralized exchange responsible for facilitating the swap, ](https://cointelegraph.com/news/usdc-investor-shells-out-2m-to-receive-0-05-usdt-trying-to-evade-crash) [said](https://twitter.com/KyberNetwork/status/1634524632220057600) it was “assisting with funds recovery” and is in touch with the user regarding the issue. [filed an emergency protocol](https://cointelegraph.com/news/maker-dao-files-emergency-proposal-addressing-3-1b-usdc-exposure) [ on March 11 that, among many items, called for restrictions on minting DAI using USDC to prevent panic selling. Curve Finance, a popular DeFi protocol for trading stablecoins, reported a historic all-time high daily trading volume of $5.67 billion due to the events. Du Jun, the co-founder of cryptocurrency exchange Huobi Global, [posted](https://twitter.com/DujunX/status/1634460694610608128): Subsequently, crypto projects incorporating DAI in their tokenomics also ](https://cointelegraph.com/news/maker-dao-files-emergency-proposal-addressing-3-1b-usdc-exposure) [suffered losses due to a chain reaction](https://cointelegraph.com/news/aavegotchi-bonding-curve-closes-on-exact-day-of-dai-depeg). A few other platforms simply could not handle the sheer volume of trade requests relating to USDC. At the time of publication, 82 million USDC is worth $75.26 million. Asked a few crypto veterans; losses amounted to >$1 billion in stock and deposits, myself included. [USDT](https://cointelegraph.com/tether-price-index)) after paying over 2.08 million USDC in a swap that [resulted in a permanent loss](https://cointelegraph.com/news/usdc-investor-shells-out-2m-to-receive-0-05-usdt-trying-to-evade-crash) [. [commented](https://twitter.com/ASvanevik/status/1634558951537909761) that Circle and USDC “can make it.“ However, Svanevik also warned that Circle requires “top-class execution over the next few days,” such as “flawless redemptions,“ and no calls for “bailouts publicity.“ In another tweet, Svanevik also revealed that a user moved 25 million USDC from their PulseX sacrifice wallet and exchanged it for DAI. [reportedly](https://twitter.com/PeckShieldAlert/status/1634461007803461632) withdrew 82 million USDC from the decentralized finance (DeFi) protocol, Aave v2, over a series of transactions and swapped from Dai ( [DAI](https://cointelegraph.com/dai-price-index)). “[I] dodged, LUNA, dodged 3AC, even dodged FTX [and their collapse], but I couldn’t avoid Silvergate, nor SVB and USDC.

Stablecoin USD Coin (USDC) lost its dollar peg and slumped to an all-time low on Saturday after Circle, the US firm behind the coin, revealed some of the ...

The largest, Tether, has a market cap of $72 billion, according to CoinGecko. USDC is the second-biggest stablecoin with a market cap of $37 billion. USDC’s price usually holds close to $1, making Saturday’s drop unprecedented. It recovered slightly to trade around $0.90. [tweet](https://twitter.com/circle/status/1634341007306248199) Friday it and USDC “continue to operate normally” while the firm waits for clarity on what will happen to Silicon Valley Bank depositors. [collapsed lender Silicon Valley Bank](http://www.cnn.com/2023/03/11/business/svb-collapse-roundup-takeaways/index.html), the company said in a [tweet](https://twitter.com/circle/status/1634391505988206592) Friday.

The pledge came as crypto traders fretted over the value of USDC, a stablecoin meant to be pegged to the U.S. dollar but which fell in value after Silicon ...

[ Consensus 2023](https://consensus.coindesk.com/), CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. CoinDesk is an independent operating subsidiary of [Digital Currency Group](https://dcg.co/), which invests in [cryptocurrencies](https://dcg.co/#digital-assets-portfolio) and blockchain [startups](https://dcg.co/portfolio/). [strict set of editorial policies](/ethics/). As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of [stock appreciation rights](https://www.investopedia.com/terms/s/sar.asp), which vest over a multi-year period. dollar but which fell in value after Silicon Valley Bank’s collapse. Circle was holding $3.3 billion of USDC’s cash backing at Silicon Valley Bank when the FDIC seized the bank’s assets on Friday.

Stablecoin USD Coin (USDC) lost its dollar peg and slumped to an all-time low on Saturday after Circle, the U.S. firm behind the coin, revealed that some of ...

Stablecoin USD Coin (USDC) lost its dollar peg and slumped to an all-time low on Saturday before recovering most of its losses after Circle, the firm behind it, ...

The largest, Tether, has a market cap of $72 billion, according to CoinGecko. USDC is the second-biggest stablecoin with a market cap of $37 billion. dollars over the weekend while banks are closed, citing “heightened activity,” while it plans to resume swaps on Monday. Silicon Valley Bank collapsed on Friday in the largest U.S. Dollar,” the company said in a blog post. Circle said in a tweet on Friday it has $3.3 billion of its $40 billion of USDC reserves at Silicon Valley Bank.

USDC stablecoin is latest to lose U.S. dollar peg after owner announced holdings at the failed Silicon Valley Bank.

treasuries," and that "USDC reserves are held in the custody and management of leading U.S. [$40 billion collapse](https://www.investopedia.com/sec-sues-terra-and-founder-for-fraud-7111256) of the TerraUSD stablecoin last May. [halt the agreement](https://www.investopedia.com/binance-and-paxos-caught-up-in-cryto-regulatory-crackdown-7108974) in February and BUSD lost more than 50% of its market cap. Federal Reserve Chairman Jerome Powell's [comments](https://www.investopedia.com/fed-vice-chairman-offers-olive-branch-to-crypto-7253352) this week that he sees "turmoil," and "run risk" in digital currencies haven't aged well in light of the Silicon Valley Bank collapse. Its website says "every digital dollar of USDC on the internet is 100% backed by cash and short-dated U.S. The cryptocurrency sector faces a major headache with another stablecoin in trouble. Paxos was involved in a commercial partnership to mint the stablecoin for Binance, the world's largest crypto exchange. "Following the confirmation at the end of today that the wires initiated on Thursday to remove balances were not yet processed, $3.3 billion of the ~$40 billion of USDC reserves remain at SVB," a Circle tweet said.4 That $40 billion figure has now been reduced and almost 10% of the USDC reserves are now held in the failed bank. The 1:1 peg to the U.S. Payments giants Visa (V) and Mastercard (MA) were both previously involved in the testing of crypto payments using USDC.56 Silicon Valley Bank (SIVB) collapsed on Friday, marking the largest U.S. currency amid a surge of investor withdrawals after its founder, Circle Internet Financial Ltd., said it had $3.3 billion invested in the collapsed

Circle seeks to reassure users of the world's second largest stablecoin following the collapse of one of its banking partners.

One of those is SVB, [which was seized](https://www.axios.com/2023/03/11/the-largest-bank-run-in-history) by the Federal Deposit Insurance Corporation (FDIC) on Friday. - Circle initiated a reshuffling of its cash holdings, as uncertainty about the bank grew. As such, it generally maintains a price of almost exactly $1, even in the hectic cryptocurrency markets. banking system is creating fears for users of the $40 billion stablecoin, because a portion of its cash reserves were held at SVB, which the U.S. USDC's struggles suggest more financial turmoil is in store, as markets fully digest the collapse of SVB. treasuries, while $9.7 billion is held Why it matters: Uncertainty in the U.S. [also previously disclosed](https://twitter.com/circle/status/1634391505988206592)that $3.3 billion of its fund are currently stuck at SVB. [rapid collapse of Terra](https://www.axios.com/2022/06/06/terra-stablecoin-fell-apart-bitcoin-bear-report), another stablecoin; while [Tether's USDT](https://www.axios.com/2022/11/10/tethers-usdt-stablecoin-depegs-from-dollar-for-a-brief-window)(the world's largest) also briefly de-pegged in November. [an update](https://www.circle.com/blog/an-update-on-usdc-and-silicon-valley-bank) for users Saturday afternoon, Circle said that "While USDC can be used 24/7/365 on chain, issuance and redemption is constrained by the working hours of the U.S. treasuries, such that the tokens are always redeemable 1:1 for actual dollars in a traditional bank account. dollars or short-term U.S.

Several USD Coin (USDC) holders have fled to other stablecoins since March 10 amid fears surrounding its solvency following the disclosure that a small portion ...

The bank was [shut down by California authorities](https://cointelegraph.com/news/silicon-valley-bank-shut-down-by-california-regulator) on March 10 after disclosing efforts to raise extra capital. After confirming the swap at 0x's rate in a pop-up, a bot detected the opportunity and gained 2,085,256 USDC from that Univ2 pool. The rate strongly fluctuated & only 0x’s route was successful but with a very poor rate." In a postmortem, the protocol team KyberSwap aggregation router was used in the transaction. [USDT](https://cointelegraph.com/tether-price-index)) by dumping a large amount of 3CRV (DAI/USDC/USDT) into USDT.

The stablecoin issuer has released a statement asserting that USDC “will remain redeemable” for US Dollars at a 1:1 ratio.

[blog post](https://www.circle.com/blog/an-update-on-usdc-and-silicon-valley-bank), Circle wrote that the company is legally obliged to “stand behind” [USDC](https://decrypt.co/resources/us-dollar-coin) and will cover any shortfall using corporate resources—and "external capital if necessary"—to ensure that the [stablecoin](https://decrypt.co/resources/stablecoins) can be redeemed at a ratio of 1 for 1 with the U.S. banking hours constrain its issuance and redemption, adding that USDC liquidity operations will resume “as normal” when banks open on Monday. Though these transfers had not yet been settled as of close of business Friday, we remain confident in the FDIC’s management of the SVB situation and stand ready to receive these funds.” dollar following a bank run on Silicon Valley Bank and the disclosure that $3.3 billion in USDC’s cash reserves was held by the bank that the FDIC had taken over. “USDC is currently collateralized 77% ($32.4B) with U.S. CEO Jeremy Allaire reiterated the commitment in a [Twitter thread](https://twitter.com/jerallaire/status/1634649886397267969).

Circle issued a statement regarding the current state of USDC and its treasury holdings. Despite the clarity on the matter, FUD rose.

One indicator of the declining interest and rise in FUD was the decreasing liquidity of USDC on Uniswap. Based on the data provided by Circle, 77% of USDC was collateralized through U.S. Notably, angel investor Naval Ravikant commented in a tweet that this event might motivate businesses to seek alternatives for depositing their funds, other than banks. The rest of its funds, which totaled $9.7 billion, were held at various institutions, one of which was SVB. One of the reasons for the sharp decline in USDC’s market cap was the behavior of various large-scale funds and investors. At press time, the liquidity of USDC on the DEX reached a 2-year low of $85,190,702.41.