The USDC stablecoin issuer plans to use corporate resources, including external capital, to fill the gap.
Circle Internet Financial statedwhich will cover any shortfall in assets backing the USDC stablecoin if it does not receive the entire $3.3 billion cash reserve held at Silicon Valley Bank.
Sharing an Update on USDC and Silicon Valley Bank. https://t.co/Ug3qpot8sJ
— Jeremy Allaire (@jerellaire) March 11, 2023
On March 10, the California Department of Financial Protection and Innovation closed Silicon Valley Bank (SVB) due to “lack of liquidity and solvency” and appointed the Federal Deposit Insurance Corporation (FDIC) as administrator. The regulator also noted that depositors will have access to deposits on Monday, March 13.
Return of Circle assets may take a long time
The issuer of the stablecoin acknowledged that the return of funds could take a long time, and also admitted that it would not be possible to receive the investment in full. According to site FDIC, the standard amount of deposit insurance is $250,000 per depositor.
According to Circle CEO Jeremy Allair, 77% of USDC reserves are in Treasury bonds and 23% are in U.S. dollar cash held at various institutions. In addition to Silicon Valley Bank, the company uses the services of BNY Mellon, BlackRock and Signature Bank.
Source: Cryptocurrency
I am an experienced journalist and writer with a career in the news industry. My focus is on covering Top News stories for World Stock Market, where I provide comprehensive analysis and commentary on markets around the world. I have expertise in writing both long-form articles and shorter pieces that deliver timely, relevant updates to readers.
