Traders pull $3bn from USDC

Move comes after operator Circle revealed it had $3.3bn in failed Silicon Valley Bank.

Traders have withdrawn $3bn from crypto stablecoin USDC after its operator Circle revealed it had $3.3bn in the failed Silicon Valley Bank (SVB).

In a blog post, Circle said it had cleared “substantially all” of the backlog of minting and redemption requests relating to USDC.

A total of $3.8bn worth of the token has been redeemed by investors since the weekend, and it had minted $0.8bn of new coins.

Since the collapse, Circle has rushed to move the rest of its cash deposits to other banks. With $5.4bn moved to US custody bank BNY Mellon and a further $1bn being held with Customers Bank, a small Pennsylvania-based bank.

Circle chief executive Jeremy Allaire has said they would “stand behind” the token and cover any shortfall using corporate resources, including external capital if necessary.

Cristiano Ventricelli, an analyst at credit rating agency Moody’s said: “The decision by US regulators to repay Silicon Valley Bank’s unsecured deposits in full allowed the USDC price to recover. Otherwise, USDC could have suffered from a run and been forced to liquidate its assets.”

SVB’s collapse also followed the demise of two other crypto-friendly banks, Signature and Silvergate, representing another blow to the industry’s access to the established banking system.

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Written by David Kent

David has more than a decade of sports betting and sports writing experience working with some of the biggest names in the industry. He focuses on articles covering these subjects including how crypto is transforming sportsbooks.

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