Circle Minted New $407.8 Million $USDC After Repeg
USDC was the stablecoin hit hardest last week by the collapse of Silicon Valley Bank after it announced it had a $3.3 billion exposure to the collapsed bank. This number is many times higher than the estimated $1 billion, so it has made the run away from USDC strong. USDC, at one point, recorded a peg of $0.93, the lowest level in its history.
Now stablecoin USDC has regained its peg levels over the weekend after many positive market moves.
Most of the reason comes from the closure of banks. That means on non-business days, $USDC can be compared to an asset with no intrinsic value except for people’s trust in Circle.
The only option is to sell USDC on centralized and decentralized exchanges, thus affecting price fixing. Again, USDC holds steady during non-business days thanks to your trust and the arbitrageurs.
Besides, the government’s efforts also save depositors from worrying about losing access to their money to banks that are in crisis because of their tax duties.
Today, the Fed announced $25 billion to support other banks and custodians. This eases stress throughout the financial system, promotes economic stability, and mitigates any impact on businesses, households, taxpayers, and the economy.
Earlier, Circle said it was pleased to see the US government and financial regulators taking essential steps to mitigate the risks of parts of the banking system.
A 100% deposit at SVB is safe. The 100% USDC reserve is safe and secure, and the remaining SVB funds will be transferred to BNY Mellon. Liquidity for USDC will resume when banks open on Monday.
Thanks to these positive signals, today’s cryptocurrency market has also been active again, with green books overflowing.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
