the company of Circle cryptocurrencies said on Sunday that all of its depositors in the failing banks Silicon Valley Bank and Signature Bank will be refunded and that USDC’s $3.3bn reserve deposit at SVB will be fully available when banks open on Monday.
Circle’s announcement comes after the US government stepped in on Sunday with a series of emergency measures to shore up confidence following the bankruptcy of New York-based Silicon Valley Bank and Signature Bank, which threatened to unleash a systemic crisis. .
Circle said it had no USD Coin (USDC) “stablecoin” cash reserve at Signature Bank and the token was still redeemable at 1:1 parity to the dollar.
Additionally, the crypto firm announced an automated minting and redemption of USDC through Cross River Bank starting Monday and said its expanded relationships also include USDC redemptions through BNY Mellon.
“Circle’s USDC trades will be open, including with a new automated settlement through our new partnership with Cross River Bank,” Chief Executive Jeremy Allaire said in a tweet.
“Stablecoins” are cryptocurrencies designed to maintain a constant exchange rate with “fiat” currencies – those backed by a central government and not by a physical asset such as gold – for example, through a 1:1 parity with the dollar. USDC is the second largest, with a market capitalization of $37 billion.
USDC lost its peg to the dollar and plunged to a record low on Saturday before recouping most of its losses as Circle assured investors it would stick to the peg despite its exposure to failing SVB.
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