The weekend had started in an apocalyptic atmosphere, between the revelation of the consequent exposure of Circle to the bankrupt bank Silicon Valley Bank, and the sudden unscrewing of the USDC stablecoin. On the other hand, this new week in the crypto markets opens with a series of reassuring news.
Circle and the USDC out of business?
Circle has spared no effort in the past 48 hours to reassure investors, and in general all those who are widely exposed to the stablecoin USDC.
Through of a press release, the content of which we reported to you yesterdaythe USDC issuer wanted to be reassuring in terms of its ability to manage the crisis and maintain its ability to maintain the principle of the sacred equation 1 USDC = 1$.
At the same time, we learned over the weekend that in order to prevent any risk of contagion, the US Federal Reserve deployed a support plan banking institutions in difficulty. In the aftermath, news that looked like a deliverance fell: all debtors and customers of Silicon Valley Bank would have access to their funds when the establishments open on Monday morning.
Information confirmed a few hours ago by Jeremy Allaire (CEO of Circle) who indicates that the 3.3 billion deposits kept in the accounts of SVB would be accessible today, and managed with the help of BNY Mellonanother financial institution with which Circle has agreements.
“We have been encouraged to see the US government and financial regulators taking crucial steps to mitigate the risks associated with fractional banking. 100% of SVB deposits are secure and will be available when the banks open tomorrow. 100% of USDC reserves are also safe and secure, and we will complete the transfer of remaining liquidity from SVB to BNY Mellon. »
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USDC back on track, Bitcoin in great shape
After a historic heat stroke (but not without precedent, we will remember, in fact, that USDT of Tether, the other reference stablecoin, also experienced in its time wanderings well below parity with the dollar), USDC gradually climbed the slope. At the time of writing, the situation is even more or less back to normal, with USDC at $0.98
Another consequence, as predictable as it is immediate, is that the entire crypto market breathes a sigh of relief, erasing most of its losses over the past 3 days. Bitcoin thus progresses by almost 10% and exceeds $22,500.
And tomorrow ? While everyone will start the week in a better mood than they ended the previous one, this episode will leave indelible marks and many unanswered questions on the stablecoin industry. A sector as strategic as it is fragile… and ironically unstable.
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