Connect with us

Hi, what are you looking for?

[stock_market_widget type="ticker-quotes" template="chart" color="#5679FF" assets="MSFT,AAPL,NFLX,GOOG,TSLA,NFLX,AMZN" animation="true" display_currency_symbol="true" api="yf" speed="50" direction="left" pause="true"]

Crypto

USDC Minting And Redemption Backlog Almost Cleared By Circle | Bitcoinist.com

USDC stablecoin investors panicked when Circle announced its exposure to the shuttered banks, and Circle’s latest report on USDC Reserves and attestation from Deloitte, the global audit company, confirms the connection.  However, in a new development, Circle reports almost clearing all minting and redemption requests for USDC. The current situation shows the issuer has cleared

usdc-minting-and-redemption-backlog-almost-cleared-by-circle-|-bitcoinist.com

USDC stablecoin investors panicked when Circle announced its exposure to the shuttered banks, and Circle’s latest report on USDC Reserves and attestation from Deloitte, the global audit company, confirms the connection. 

However, in a new development, Circle reports almost clearing all minting and redemption requests for USDC. The current situation shows the issuer has cleared all the backlog in transacting with the stablecoin. 

Before its closure, SVB stated its plan to boost its balance sheet by raising about $2.25 billion. This was after its loss of $1.8 billion through asset sales. The bank opted for asset sales when its efforts to raise capital failed. But the entire situation became complicated as the sales resulted in a massive outflow of deposits. 

Related Reading: Binance Discontinues Deposits, Withdrawals For UK Customers: Details

Subsequently, the California state financial regulators shut down the bank on March 10, seizing its deposits. The closure of SVB is associated with a bank run leading to a capital crisis that marked the second-largest implosion of a financial firm in the US.

The revelation of Circle’s exposure to the tune of over $3 billion to Silicon Valley Bank pushed USDC off its peg to the US dollar. Subsequently, the stablecoin de-pegged from its dollar value and even hit a record low on Saturday.

In its statement, Circle revealed it held 8% of USDC reserves of $40 billion at Silicon Valley Bank. This means that about $3.3 billion of the stablecoin reserves were trapped in the defunct bank.

After the announcement, USDC lost its $1 peg value by dropping to $0.87. The announcement from Circle created a frenzy for USDC, as even crypto whales suffered huge losses while trying to withdraw their funds. 

Advertisement. Scroll to continue reading.

Circle’s Moves In Clearing USDC Minting And Redemption Requests

Circle posted a blog on its official website, updating its USDC operations after the initial announcement. It revealed that it had completed almost all the requests regarding the redemption and minting of USDC stablecoin.

Related Reading: Sam Bankman-Fried Demands Insurance To Reimburse Attorneys’ Fees

In the update, the issuer firm confirmed it received massive customer requests between March 13 and 15. It minted almost $800 million USDC and redeemed $3.8 billion. It noted that the activities in the past week had affected the liquidity operations for USDC. Also, it acknowledged the support and patience of its customers during the tiring period.

USDC Minting And Redemption Backlog Almost Cleared by Circle
USDC market shows a decline l Source: Tradingview.com

In its quest to circumvent the situation, Circle deepened its partnership with the Bank of New York Mellon (BNY Mellon). USDC issuer also revealed its collaboration with a new banking partner, Cross River Bank. The partner assisted the USDC issuer in making US transfers on March 14. Also, the partner undertook other international transfers for Circle to and from other countries.

As of Thursday, March 16, USDC is still trading at a 1:1 parity to the US dollar. It remains the fifth-largest cryptocurrency in the world with a market cap of $39.5 billion.

Featured image from Pixabay and chart from Tradingview.com

Sign Up for Our Newsletter!

For updates and exclusive offers enter your email.

Savannah Fortis

Advertisement. Scroll to continue reading.
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Stocks

SAN FRANCISCO (MarketWatch) — Among the companies whose shares are expected to see active trade in Thursday’s session are BlackBerry Ltd., Oracle Corp., and...

Mining

NAL spodumene concentrate production remains targeted for H1 2023 with revenue potential in Q3 2023. Credit: Piedmont Piedmont Lithium (Nasdaq: PLL; ASX: PLL) announced...

Tech

This holiday season, consider giving the gift of security with an ad blocker. That’s the takeaway message from an unlikely source — the FBI...

Top Stories

There have been major developments out of Japan this week. The Bank of Japan surprised the market by widening its yield curve target by...

Advertisement