USDC Faces De-peg after disclosing $3.3B Deposit in SVB

At the time of writing, USDC is trading around $0.99 after seeing a new all-time low of $0.87 on March 11.

Published on - March 13, 2023 12:05

Updated on - March 13, 2023 12:19

1 minute read

USDC Faces De-peg after disclosing $3.3B Deposit in SVB

After the news of the U.S.’s leading banking institution, Silicon Valley Bank’s collapse spread out, top-notch stablecoin USDC experienced a de-pegging issue and hit a new all-time low as it fell below $0.9.

The downfall momentum started after the stablecoin issuer Circle disclosed its $3.3 billion in deposits with the defunct bank, Silicon Valley Bank.

1/ 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.
— Circle (@circle) March 11, 2023

The announcement triggered a panic sale of USDC as investors started to cash out their money or liquidate with other assets like USDT.

According to CoinMarketCap, USDC is now trading around $0.99 after seeing a new all-time low of $0.87 on March 11.

USDC Depeg Chart — Source: CoinMarketCap

However, Circle has asked investors to stay calm by ensuring the safety of their funds.

As per the tweet from Circle, Silicon Valley Bank is the major partner for its holding, as the bank manages around 25% of its USDC reserves held in cash. Circle is looking forward to clarity from FDIC about how receivership will impact SVB’s depositors.

Also Read: Circle CEO says The SEC is not the Right Fit to Regulate Stablecoins

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Rajpalsinh

Rajpal is enthusiastic about Blockchain and Metaverse. He is tech-savvy and is well-versed in a variety of online games. That, at the very least, explains his interest in technical writing. In contrast to his gamer demeanour, he enjoys reciting some amazing anecdotes from his journal. When he gets stuck due to his vast yet cluttered knowledge, he does gun practice to take "headshots," in his favorite game, of course!