USDC Stablecoin Dollar Peg Breaks Amidst $3.3 Billion SVB Exposure

Image Source: Unsplash USDC Stablecoin Dollar Peg Breaks Amidst $3.3 Billion SVB Exposure

[{"selector":"#anim-973333b4-7606-48f7-afd9-f5a34e702068 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-0a73d4c8-1ed9-4b91-968c-eba07fa7b33b","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-f213b3e8-153b-43c9-b05d-5ffc64c6dc4d","keyframes":{"transform":["translate3d(0px, 186.70036%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash The U.S. cryptocurrency firm Circle's USD Coin lost its dollar peg, causing it to fall to a record low on Saturday morning.

[{"selector":"#anim-965dc141-15fa-4190-a898-868b563301dd [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(-31.247589240800966%, 0, 0) translate(-25%, 0%) scale(1.5)","translate3d(0%, 0, 0) translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"fill":"forwards"}] [{"selector":"#anim-7be55fca-5b1c-4497-83ab-7359e8abaef8","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-153b33d6-1ae7-40aa-9154-8e5351cadcf2","keyframes":{"transform":["translate3d(0px, 183.91382%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Circle revealed that nearly 8% of its $40 billion in reserves were tied up at the collapsed lender Silicon Valley Bank.

[{"selector":"#anim-72bc6138-5408-45f9-875b-1850709a27c8 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-5581caf4-d968-4004-9d4b-a421f7d937c4","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-6ce57940-1d59-4c2f-b788-bcd05e14973b","keyframes":{"transform":["translate3d(0px, 153.54500%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash USDC is known as a stablecoin, designed to trade at $1, but it fell below 87 cents on Saturday. Regulators shuttered SVB on Friday, and Circle revealed it has $3.3 billion in remaining reserves at SVB.

[{"selector":"#anim-77fe3233-2ed9-4dd6-9bdc-c9c8657d753f [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(-32.0950282249818%, 0, 0) translate(-25%, 0%) scale(1.5)","translate3d(0%, 0, 0) translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"fill":"forwards"}] [{"selector":"#anim-051d5176-addb-4747-93ba-898b45ad3a71","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-2f824393-a913-4b43-9d9e-7cb404aaa376","keyframes":{"transform":["translate3d(0px, 185.40634%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Silicon Valley Bank was one of six banks that Circle used, but it was closed down earlier in the day.

[{"selector":"#anim-66be9bc5-fe19-4bdf-b989-13ec5c27872a [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(-12.499999772451451%, 0, 0) translate(-25%, 0%) scale(1.5)","translate3d(0%, 0, 0) translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"fill":"forwards"}] [{"selector":"#anim-9d8c4eb0-a75f-4408-991d-96cae703e5b2","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-e3fe1df0-fc59-4399-9b93-7d4f46aa7ee4","keyframes":{"transform":["translate3d(0px, 166.53746%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash USDC and other stablecoins are most often used by crypto traders as a sort of parking place between investments in more volatile tokens such as Bitcoin.

[{"selector":"#anim-66c35e3e-b037-46aa-ae92-c0fa581402a7 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-370271da-5d0f-467a-a15c-a80cc02943f0","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-f8ce8aee-e18b-428e-82dd-0f1111641224","keyframes":{"transform":["translate3d(0px, 185.40634%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Investors can easily send stablecoins between exchanges or move in and out of the coins almost instantly.

[{"selector":"#anim-64d3dbde-b47a-4032-b13e-9160ba2d0449 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(-31.371753133717768%, 0, 0) translate(-25%, 0%) scale(1.5)","translate3d(0%, 0, 0) translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"fill":"forwards"}] [{"selector":"#anim-cd84604e-09b8-4150-bf5e-d97c1c601428","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-e2d730e9-b24a-4794-9d79-b238e2d81cdf","keyframes":{"transform":["translate3d(0px, 185.40634%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Stablecoins maintain the peg by promising to allow investors to redeem the tokens for traditional money deposited in a bank account.

[{"selector":"#anim-672dd537-2815-4450-b1eb-150ac64621ad [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-4e8cc9d1-b9de-4b5c-af84-4f01f2b389c7","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-3d511ae2-72a4-4ab8-b7fc-424c2d20cabd","keyframes":{"transform":["translate3d(0px, 166.53746%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash The cryptocurrency industry is still picking up the pieces after the sudden collapse of FTX last year, and USDC’s break with the dollar could signal more trouble ahead.

[{"selector":"#anim-81f577e2-6c4c-4c8a-8fbb-4a1268c533fd [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-187fce1e-8ce0-4265-a5e3-740ebbbc681a","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-08a27e51-aa69-400b-9762-804803a5c566","keyframes":{"transform":["translate3d(0px, 166.53746%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash USDC and Tether are most often used by crypto traders as a sort of parking place between investments in more volatile tokens such as Bitcoin.

[{"selector":"#anim-c6493e44-5d06-4067-a61c-d1b1191ecc06 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-5ad3e597-6557-4fe7-921e-fbd2c971b638","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-9e709ef7-cf4c-4ba9-b4e4-df1a08d81b04","keyframes":{"transform":["translate3d(0px, 154.49736%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Stablecoins maintain the peg by promising to always allow investors to redeem the tokens for traditional money deposited in a bank account. As of March 9, Circle said it had $43.5 billion in reserves backing $43.4 billion in USDC tokens.

[{"selector":"#anim-eeb815ae-8016-4cc4-bb6e-7001eb52a397 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(-12.499999772451451%, 0, 0) translate(-25%, 0%) scale(1.5)","translate3d(0%, 0, 0) translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"fill":"forwards"}] [{"selector":"#anim-533d1f63-d912-4313-acb0-f036862c0ec6","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-61008cd8-38a7-4830-9b50-1335423edfce","keyframes":{"transform":["translate3d(0px, 154.49736%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Any significant haircut to its deposits in Silicon Valley Bank would be more than enough to put the token underwater. Circle had made a wire transfer request on Thursday before the FDIC takeover, the company said, but it wasn’t processed.

[{"selector":"#anim-33a168b4-c7c1-47d6-96a5-7a4c13b0d696 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-52fd58d9-4d2e-4971-9841-a7dd373fcb64","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-0d5f97b5-1a9a-400e-83a9-d8a72b6bd844","keyframes":{"transform":["translate3d(0px, 166.53746%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Investors losing faith in USDC could send more assets to Tether and contribute to volatility in the price of Bitcoin and other tokens as investors lose one of the main mechanisms they used to trade.

[{"selector":"#anim-779b09ef-4d40-4264-a0cc-d037268d344d [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-4153d6fd-dfe7-4cee-88e1-0e3ef67d3192","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-2d13f7ef-cb69-4ec8-b897-4bd2f5e512e0","keyframes":{"transform":["translate3d(0px, 185.40634%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Coinbase shares a portion of the revenues that USDC's reserves generate, and any lack of faith in the coin could impact it.

[{"selector":"#anim-65c28ecd-714b-409a-a5a0-a829146f996e [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(-31.287202267403853%, 0, 0) translate(-25%, 0%) scale(1.5)","translate3d(0%, 0, 0) translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"fill":"forwards"}] [{"selector":"#anim-03c3378a-c37e-4007-9d69-d0ce25b4bdde","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-5ddbbcc1-55bd-4905-8af0-a6493a7c289a","keyframes":{"transform":["translate3d(0px, 185.40634%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Image Source: Unsplash Coinbase late Friday said it was temporarily pausing conversions between USDC and regular dollars over the weekend.