Stablecoin $USDC lost 1$ peg because#Circle(USDC provider) stuck 3.3 billion USD in escrow money at Silicon Valley Bank after the news of Silicon Valley Bank's bankruptcy.
Binance and Coinbase simultaneously stopped converting $USDC, creating more panic sell pressure.
When the supply of $USDC could not keep up with demand, the market responded by lowering the price of USDC to create more tokens. This causes USDC to decrease in price compared to the US dollar so 1 $USDC is no longer supported = 1 $USD in reserve. As a result, many investors panicked and sold $USDC to other assets, exacerbating the devaluation.
#circle #SVB #USDC
