Circle, the issuer of the popular stablecoin USDC, has provided details on the structure and management of the USDC reserve. According to Circle’s official blog post, the reserve is fully transparent and has third-party assurances that it has sufficient assets to cover its liabilities. The USDC reserve consists of about 80% short-term U.S. Treasuries and about 20% cash deposited in the U.S. banking system.

The short-term U.S. Treasuries in the reserve are considered the most liquid assets in the world and are held in an SEC-regulated, wholly-owned, government money fund structure. They are not subject to lock-ups or redemption gates, and there is daily independent, third-party reporting on this portfolio, down to each individual security.

The cash portion of the USDC reserve is held in segregated accounts for the benefit of USDC holders and is used to satisfy the immediate liquidity needs of customers. Circle has taken steps to reduce risk from the banking system by holding substantially all of the cash portion of the reserve at one of the world’s 30 global systemically important banks, also known as a GSIB.

Circle has always aspired to hold the cash portion of the USDC reserve directly with the Federal Reserve to fulfill its vision of USDC as true tokenized cash. However, stablecoin legislation is needed for this to happen. Circle has been at the forefront of calls for federal regulation of the digital asset industry since its founding in 2013 and is optimistic that Congress will act.

In the unlikely event of a Circle bankruptcy, the USDC reserve would remain segregated for USDC holders and would not be part of the bankruptcy estate. Circle stands behind USDC and its obligations to USDC holders, with all its corporate resources, including current corporate cash in excess of $800 million and external capital if necessary.

USDC is a true bearer asset that is always redeemable 1:1 for the U.S. dollar. It is capable of self-custody and transferable to anyone, anywhere, at the high speed and low cost of the internet. USDC has the potential to transform financial services by lowering costs and increasing utility for billions of users.

The transparency and management of the USDC reserve provide confidence to USDC holders and demonstrate the industry’s commitment to safe and secure stablecoins. As the digital asset industry continues to grow, regulatory clarity and stablecoin legislation will be essential to ensure the safe and seamless flow of money between blockchain-based finance and fiat banking.

#USDC #Circle #crypto2023 #BTC #azcoinnews

This article was republished from azcoinnews.com

Circle, the stablecoin issuer, has finally gained access to its $3.3 billion funds held with the collapsed Silicon Valley Bank (SVB). This news has come as a great relief to the company, which had been struggling to retrieve its cash reserves from the failed lender.

Circle CEO and co-founder, Jeremy Allaire, confirmed the news on March 13, stating that the company has been “able to access” its funds from SVB. Speaking with Bloomberg Markets on March 14, Allaire further added that he believed “very close to everything was able to clear” from the failed lender.

This is good news for Circle, as it had been facing liquidity concerns since news broke that its cash reserves were stuck on SVB. The situation led to USDC, the stablecoin issued by Circle, briefly de-pegging, causing widespread panic in the crypto market.

However, the stablecoin’s dollar peg has since recovered, and the market seems to have stabilized following the news of Circle’s successful retrieval of its funds. Nevertheless, the situation has led to mass redemptions of USDC, resulting in a nearly 10% drop in the stablecoin’s market cap since March 11, according to TradingView.

Meanwhile, USDC’s peer stablecoin Tether (USDT) has recorded a slight increase in its market cap since March 11, climbing by over 1% to $73.03 billion.

The collapse of SVB has raised concerns about the stability of the crypto market and the role of banks in supporting digital assets. As Circle’s experience demonstrates, the collapse of a banking institution can have a significant impact on the crypto market and its participants.

The news of Circle’s successful retrieval of its funds from SVB may provide some reassurance to the market, but it also highlights the need for greater regulation and transparency in the crypto industry. As the industry continues to grow, it is essential that companies and institutions operating within it are held to the same standards as traditional financial institutions.

Record-breaking USDC burn and $4.5 billion in conversion requests since March 10th

In recent days, there has been a significant increase in requests to convert USDC back to cash, with a net value of over $4.5 billion. According to blockchain data, Circle, the second largest issuer of stablecoin in the cryptocurrency market with USDC, has recorded a massive withdrawal of funds over the past few days, following serious depegging caused by bank collapses in the United States.

From the time the Silicon Valley Bank was seized and closed by the US government on Friday, March 10, to the early morning of Tuesday, March 15, on-chain data shows that more than 6.2 billion USDC was sent back to Circle by its holders with requests for conversion to cash. During the same period, the new issuance of USDC was $1.66 billion, resulting in a net withdrawal of over $4.5 billion.

The market cap of USDC has dropped from $43.5 billion before the depegging to $38.2 billion at the time of writing, equivalent to $5.3 billion. It is noteworthy that a USDC burn transaction worth up to $723 million was recorded on the morning of March 15, making it the largest USDC burn transaction in history. The second-largest transaction, with a value of $656 million, was also executed on March 14.

#USDC #USDCSTABLECOIN #Circle

This article was republished from azcoinnews.com

Circle, a #stablecoin issuer, revealed that it has mostly fulfilled all of the outstanding redemption requests for its stablecoin Dollar Coin (USDC).

Circle said that it has redeemed $3.8 billion USDC and issued $800 million USDC between the morning of March 13 and the close of business on March 15 in an operational update.

Update: As of close of U.S. banking operations Wednesday, March 15, we have cleared substantially all of the backlog of minting and redemption requests for USDC. Get the details: https://t.co/5WEAgPps0E

— Circle (@circle) March 16, 2023

After reporting last week that it held stablecoin reserves worth $3.3 billion in the now-defunct #SiliconValley Bank, which caused USDC to lose its dollar peg, Circle experienced a bank run.

In a blog post, Circle stated that the recent events had an effect on USDC's liquidity operations. It also stated that it has been working to restart services with alternative banking partners, notably payment and #USDC redemption services.

A new banking partner was employed by #Circle on March 14 for wire transfers inside the United States, and on March 15 for transfers outside to and from 19 other countries.

It stated that by March 16, further capabilities were anticipated to be online.

In a recent incident, Dante Disparte, the Chief Strategy Officer of Circle, had his Twitter account hacked, and a fake airdrop message was posted by the hackers.

The tweet posted on March 22nd announced a token reward for longtime USDC users, which has since been deleted. At the time of writing this article, four of the hacker’s tweets have been deleted, leaving only three remaining tweets that comment on events surrounding USDC.

The notifications were posted when Dante Disparte’s Twitter account was hacked.

Jeremy Allaire, the CEO of Circle, confirmed that the chain of tweets promising a money airdrop for USDC holders was not authentic. He stated that Disparte’s account was hacked, and false information was spread.

“Any links leading to the airdrop event are scams. We are investigating the situation and implementing appropriate measures,” the USDC issuer wrote. At that time, the imposter claiming to be Disparte asserted that the USDC owner would receive a reward after the stablecoin lost its peg at the beginning of February.

The attacker claimed that the token reward would be distributed to the community through an airdrop. One tweet in the chain of posts redirected users to a URL that was not on Circle’s domain.

From March 11th to 12th, the USDC stablecoin lost its peg at a 1:1 exchange rate with the USD, reaching a record low of $0.87 at times. It was only on Monday, March 13th, when banks resumed operations, that USDC returned to its peg.

Shortly after, fake Circle accounts began to appear on social media, promising to compensate users for their losses. Despite USDC’s return to $1, many people sold their USDC at a loss during the market’s panic. An estimated $10 billion was lost.

This event highlights the importance of security measures and serves as a reminder to be vigilant while online. The incident also underscores the risks of putting one’s trust in cryptocurrencies and stablecoins. While blockchain technology is known for its security, hacks and scams remain a significant issue in the industry. It is crucial to remain informed and cautious when dealing with digital currencies.

#USDC #Circle #hack #Disparte #azcoinnews

This article was republished from azcoinnews.com

Follow us on Telegram @azcoinnews and Twitter @azcoinnews