{"id":616721,"date":"2023-03-11T08:58:43","date_gmt":"2023-03-11T14:58:43","guid":{"rendered":"https:\/\/news.sellorbuyhomefast.com\/index.php\/2023\/03\/11\/usdc-depegs-as-circle-confirms-3-3b-stuck-with-silicon-valley-bank\/"},"modified":"2023-03-11T08:58:43","modified_gmt":"2023-03-11T14:58:43","slug":"usdc-depegs-as-circle-confirms-3-3b-stuck-with-silicon-valley-bank","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2023\/03\/11\/usdc-depegs-as-circle-confirms-3-3b-stuck-with-silicon-valley-bank\/","title":{"rendered":"USDC depegs as Circle confirms $3.3B stuck with Silicon Valley Bank"},"content":{"rendered":"
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At the time of writing, USDC had lost over 10% of its value as it traded at $0.8774, and a Circle executive envisions broader implications for business, banking and entrepreneurs without a Federal rescue plan. <\/p>\n

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Almost immediately after USD Coin (USDC<\/a>) issuer Circle revealed it could not withdraw $3.3 billion of its $40 billion reserves from Silicon Valley Bank (SVB), the resultant sell-off caused the price of the stablecoin to fall below its $1 peg.<\/p>\n

On March 9, Circle initiated a wire transfer to remove its funds from SVB as the Federal Deposit Insurance Corporation-insured bank was about to shut operations<\/a>. However, two days later, on March 11, Circle confirmed that the wire transfers were not wholly processed, with $3.3 billion of USDC reserves still with SVB.<\/p>\n

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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. economy and will follow guidance provided by state and Federal regulators.<\/p>\n

\u2014 Circle (@circle) March 11, 2023<\/a><\/p><\/blockquote>\n

Data from Cointelegraph Markets Pro<\/a> and TradingView show that USDC prices fell immediately after the revelation, as shown below:<\/p>\n

USDC depegs from the U.S. dollar. Source: CoinMarketCap<\/em><\/figcaption><\/figure>\n

At the time of writing, USDC had lost over 10% of its value as it traded at $0.8774. According to Dante Disparte, the chief strategy officer and head of global policy for Circle, SVB is critical to the United States economy and warned that \u201cits failure \u2014 without a federal rescue plan \u2014 will have broader implications for business, banking and entrepreneurs.<\/p>\n

USDC price change metric. Source: CoinMarketCap<\/em><\/figcaption><\/figure>\n

Disparte further added:<\/p>\n

\u201cAs with Silvergate, our teams have worked at speed to limit any exposure to banks. This includes a wire transfer request made before SVB\u2019s FDIC receivership. A $3.3 billion cash exposure remains \u2014 but we follow state and federal regulatory guidance.\u201d<\/p><\/blockquote>\n

On-chain data further reveals<\/a> that Circle redeemed $1.4 billion USDC in 8 hours. To reduce exposure, crypto companies, including Coinbase and Jump Trading, redeemed approximately $850 million and $138 million USDC, respectively. <\/p>\n

Related: <\/em><\/strong>Breaking: Circle discloses $3.3B tied up at Silicon Valley Bank<\/em><\/strong><\/a><\/p>\n

Just two weeks ago, on Feb. 23, USDC issuer Circle announced plans to increase its staff headcount by 25% \u2014 going against the ongoing layoff trend. <\/p>\n

During the timeline, Circle\u2019s chief financial officer Jeremy Fox-Geen had shared its intent to go public, pending an improvement in market conditions. He added that the crypto industry needs more distance from the Terra and FTX implosions for public investors to re-evaluate the future of digital-assets businesses.<\/p>\n