Circle redeemed $2.9 billion worth of USDC since Monday

abdelaziz Fathi

Circle, the issuer of the second-largest stablecoin by market capitalization, said it’s now ready to handle the USDC stablecoin redemptions after it regained access to the $3.3 billion locked up in Silicon Valley Bank. Since Monday morning, the American startup has redeemed $2.9 billion USDC and minted new tokens worth $700 million.

As revealed in a blog post, Circle has restored USDC liquidity and resumed its regular operations, including bringing on new transaction banking partners. Moreover, the company now holds the cash portion of USDC reserves at BNY Mellon, except for limited funds held at other banking partners to support minting and redemption requests.

The statement further states that the majority of the reserve is invested in the Circle Reserve Fund, managed by BlackRock and custodied at BNYM, which is principally comprised of short dated U.S. Treasuries.

“Since the failures of Signature Bank and Silvergate Bank, our core transaction banking partners, our teams have been working around the clock to. We began processing minting and redemption requests on Monday morning, March 13, when the U.S. banking system re-opened, and are currently working through the backlog. We have more to do here, including adding new transaction banking partners with 24/7/365 capability, and we will keep our community posted on our progress,” it said.

Circle’s token lost its dollar peg last week and slumped to an all-time low of $0.8 per coin after the issuer revealed it has nearly 9 percent of its $40-billion USDC reserves stuck at Silicon Valley Bank. However, the stablecoin then recovered most of its losses (now trading at a spot price of $0.9992) after Circle assured investors it would honor the peg despite exposure to failed bank.

The Boston-based firm said that in the event Silicon Valley Bank does not return 100% of deposits, it will cover any shortfall in the assets backing its stablecoin using corporate resources, involving external capital if necessary.

“However, it is also possible that SVB may not return 100% and that any return might take some time, as the FDIC issues IOUs (i.e., receivership certificates) and advanced dividends to deposit holders,” Circle said.

According to its latest breakdown, dated as of December 31, 2022, Circle held 100% of its $44.5 billion reserves in cash and cash equivalents. Specifically, short-term United States Treasuries formed the majority of its cash equivalents category with $34 billion or a 75 percent share. The company also reported $10.5 billion in cash held at regulated financial institutions in the US.

  • Read this next

    Digital Assets

    Celsius founder Mashinsky agrees to shared lawyers with Sam Bankman-Fried

    Former Celsius CEO Alex Mashinsky has addressed potential conflicts of interest in his legal representation during a brief hearing in a New York courtroom.

    Digital Assets

    Sam Bankman-Fried captured in first jail photo

    Sam Bankman-Fried, the once-billionaire founder of FTX, has been spotted looking quite different with a new beard and a slimmer figure in a photo that’s been making rounds, reportedly taken inside New York’s Metropolitan Detention Centre.

    Market News

    Bitcoin stalls at $53,000 level, Ethereum reaches $3,000

    Bitcoin (BTC) faced renewed resistance at the crucial $53,000 level on Tuesday, indicating that the primary cryptocurrency is likely to continue consolidating before making its next decisive move.

    Digital Assets

    UK targets new laws for stablecoins and crypto staking within six months

    The United Kingdom is gearing up to enact fresh legislation regulating stablecoins and crypto staking within the next six months.

    Web3

    Masa’s Milestones Before Mainnet Launch

    Since its launch in August 2022, Masa, the premier decentralized network for personal data, has experienced rapid growth, securing over 1.2 million unique wallets and accumulating more than 23 million data points. Despite a bear market, the network has attracted over 40,000 node operators to its testnet within just 18 months.

    Digital Assets

    Web3 Greatest Startup Competition Hits $10M in Prizes

    We’re thrilled to announce the return of the highly anticipated Startup Competition at Paris Blockchain Week. With a staggering array of prizes totaling over $10 million, encompassing funding, grants, credits, accelerations, listing, and more, this competition has become a cornerstone event within the blockchain startup ecosystem.  

    Digital Assets

    Hedge fund Tyr Capital faces dispute over exposure to FTX

    Crypto hedge fund Tyr Capital found itself embroiled in a dispute with one of its clients concerning its investment exposure to the bankrupt digital assets exchange FTX, as reported by the Financial Times on Tuesday.

    Retail FX

    Plus500 revenue down to $725 million, unveils $100M share buyback

    Israeli-based, but London-stock market listed Plus500 Ltd (LON:PLUS) today reported its 2023 results, which came “significantly ahead” of analysts’ estimates.

    Education

    Strategies for Profiting from Interest Rate Fluctuations

    The world of Forex trading is a complex and dynamic domain where interest rates play a pivotal role in shaping currency values. Octa’s team of financial experts delves into this intricate relationship, providing traders with a comprehensive understanding and strategies to harness economic indicators for enhanced trading performance.

    <