The collapse of Silicon Valley Bank (SVB) led to an unprecedented collapse in the value of USDC. The stablecoin company Circle burned almost $650 million worth of USDC over the past 24 hours, and issued $16.7 million worth of USDC. the action helped bring the USDC back to $0.97 after a hard fall to $0.88.
USDC was one of the first victims of the SVB collapse, as the bankrupt bank held approximately $3.3 billion worth of these stablecoins. As a result, USDC lost its peg to the dollar.
Following the news of the SVB, Circle assured the community that it would continue with standard operations pending clarification regarding the transfer of SVB assets to the Federal Fund Insurance Corporation (FDIC) and how these actions would affect contributors. Burning and issuing tokens was just one of the measures that helped to continue providing services to customers.
Recall that earlier Circle itself admitted that a significant proportion of USDC reserves were stored in the Silicon Valley bank.
Source: Bits
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