- Circle has been able to access the $3.3 billion it holds in Silicon Valley Bank, according to CEO Jeremy Allaire
- Allaire told Bloomberg that almost all the funds had been moved to another bank
- While Circle’s USDC coin has re-pegged to the dollar, its market cap is down some 10%
Circle CEO Jeremy Alllaire has reassured investors and the wider crypto community that the company has been able to access the $3.3 billion it holds in the shuttered Silicon Valley Bank. Allaire told Bloomberg Markets yesterday that he believed almost everything it held in the bank was “able to clear” after the 35-year-old bank failed following a bank run. Following news of the temporarily locked funds last week, Circle’s stablecoin USD Coin (USDC) briefly de-pegged from its dollar value, but the peg has since recovered, although its market cap remains in a downward spiral.
Circle’s Eventful Nine Months
Circle’s USDC coin has endured an eventful last nine months, with its trials this week a far cry from last June when it was rapidly catching up with market leader Tether (USDT). Since then however, Binance has essentially delisted it and MakerDAO has put in place plans to strip it from its DAI stablecoin backing following its decision to blacklist USDC after Circle froze 75,000 tokens related to the Tornado Cash sanction.
All this has seen USDC lose some of the ground it had made against USDT, and last week’s news that Circle had over $3 billion tied up in Silicon Valley Bank was the final straw for many. USDC has experienced a near 10% drop in market cap since March 11 due to mass redemptions, with the news having a huge impact, despite the locked funds representing less than 8% of USDC’s reserves. Its market cap currently sits at around $38 billion, around half that of USDT now.
In the Bloomberg interview, Allaire deflected questions over the reputational damage the depeg had caused to Circle and instead blamed the fractional reserve system of banking and attempted to reassure the crypto community that almost everything had been transferred out of Silicon Valley Bank to other banking institutions, with a full report due today.
