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Circle says $3.3B of its ~$40B USDC reserves remain at Silicon Valley Bank and that the crypto payments firm will follow state and federal regulators' guidance

- After being largely silent on Friday, Circle said it has $3.3 billion in exposure to Silicon Valley Bank

The Block Frank Chaparro

Discussion

  • @circle @circle on x
    1/ Following the confirmation at the end of today that the wires initiated on Thursday to remove balances were not yet processed, $3.3 billion of the ~$40 billion of USDC reserves remain at SVB.
  • @circle @circle on x
    2/ Like other customers and depositors who relied on SVB for banking services, Circle joins calls for continuity of this important bank in the U.S. economy and will follow guidance provided by state and Federal regulators.
  • @unusual_whales @unusual_whales on x
    @circle The full list of banks that held cash for Circle's USDC are Bank of New York Mellon, Citizens Trust Bank, Customers Bank, New York Community Bank (a division of Flagstar Bank, N.A.), Signature Bank, Silicon Valley Bank and Silvergate Bank. Read more: https://unusualwhales…
  • @cryptowendyo Wendy O on x
    Dear @SenWarren this was a UNITED STATE OF AMERICA REGULATED AND LICENSED BANKING FAILURE NOT A CRYPTO ISSUE Circle did everything they were told to do, your people fxcked this up What are you going to do to fix it? oh that's right ... pass the cost to American Underdogs https://…
  • @asvanevik Alex Svanevik on x
    $3.3B of USDC reserves stuck in SVB. -> 8% of supply. https://twitter.com/...
  • @michaeljordaan Michael Jordaan on x
    The irony: a stablecoin is suffering because of a bank failure. Not banks failing because of crypto. https://www.coindesk.com/...
  • @circle @circle on x
    Silicon Valley Bank is one of six banking partners Circle uses for managing the ~25% portion of USDC reserves held in cash. While we await clarity on how the FDIC receivership of SVB will impact its depositors, Circle & USDC continue to operate normally. https://www.circle.com/..…
  • @0xfoobar @0xfoobar on x
    worst worst worst case SVB prob sees 95% recovery imo so fair value is ~$0.995, not 92 cents lmfao https://twitter.com/...
  • @1markmoss Mark Moss on x
    USDC stablecoin, which is or was fast on the path to becoming a US-CBDC, doesn't have your dollars anymore... they lent them to a bank that lent them to the government, and they went up in 🔥 https://twitter.com/...
  • @silvermanjacob Jacob Silverman on x
    That doesn't sound good. https://twitter.com/...
  • @alice_comfy Alice on x
    Not sure what other assets Circle has but assuming equal weighting between banks, hole is probably around 4%. Worst case scenario is if everything they got out of Silvergate went to Silicon Valley bank, then it could be around 5%. No idea how this would work for the coin. https:/…
  • @northrocklp Hal Press on x
    So circle has 3.3B at SVB. Can assume they get at least 90% of that back. Should be able to cover a 330mm shortfall if thats what's required. Worst case they have 99.1c on the dollar. https://twitter.com/...
  • @autismcapital @autismcapital on x
    Oh boy. https://twitter.com/...
  • @epro Emil Protalinski on x
    Funds flowing from $USDC to $USDT because Circle holds some USDC reserves in Silicon Valley Bank. Crypto trades 24/7 so this weekend won't be much of a reprieve. https://twitter.com/...
  • @mikeburgersburg @mikeburgersburg on x
    $USDC not looking good. https://twitter.com/... https://twitter.com/...
  • @chainlinkgod @chainlinkgod on x
    Never thought I'd see the day where there would be real tangible concerns around USDC's reserves Uncharted waters here, especially with some of Circle's other banking partners now also raising some eyebrows https://techcrunch.com/...
  • @coinbase @coinbase on x
    We are temporarily pausing USDC:USD conversions over the weekend while banks are closed. During periods of heightened activity, conversions rely on USD transfers from the banks that clear during normal banking hours. When banks open on Monday, we plan to re-commence conversions.
  • @coinbase @coinbase on x
    Your assets remain safe & available for on-chain sends.
  • @simonpb Simon Brown on x
    Crypto needing banks to be open in order to operate in periods of stress kinda defeats the purpose of crypto ?! https://twitter.com/...
  • @edzitron Ed Zitron on x
    This is so bad lmao oh no!! https://twitter.com/...
  • @binance @binance on x
    Binance has temporarily suspended auto-conversion of USDC to BUSD due to current market conditions, specifically related to high inflows & the increasing burden to support the conversion. This is a normal risk-management procedural step to take while we monitor the situation.
  • @jerallaire Jeremy Allaire on x
    Tl;Dr: While USDC can be used 24/7/365 on chain, issuance and redemption is constrained by the working hours of the U.S. banking system. USDC liquidity operations will resume as normal when banks open on Monday morning in the United States. As a practical matter, our teams are...…
  • @kobeissiletter @kobeissiletter on x
    Current List of Companies With Silicon Valley Bank, $SIVB, Deposits: 1. Circle: $3.3 billion 2. Roku: $487 million 3. BlockFi: $227 million 4. Roblox: $150 million 5. Ginkgo Bio: $74 million 6. iRhythm: $55 million 7. Rocket Lab: $38 million 8. Sangamo Therapeutics: $34 million..…
  • @adamscochran Adam Cochran on x
    Tl;DR Circle will honor 1:1 and essentially buy any shortfall debt from their own corporate resources. 100% backed. https://twitter.com/... https://twitter.com/...
  • @wublockchain Wu Blockchain on x
    Circle: it is also possible that SVB may not return 100%, in such a case, Circle will stand behind USDC and cover any shortfall using corporate resources, involving external capital if necessary. https://www.circle.com/...
  • @mariuscrypt0 James Bull on x
    Just in. “Circle, as required by law under stored-value money transmission regulation, will stand behind USDC and cover any shortfall using corporate resources, involving external capital if necessary.” Send it. https://www.circle.com/...
  • @ddisparte Dante Disparte on x
    Sharing .@circle's update on the Silicon Valley Bank crisis. That a regulated U.S. money transmission company would face risk because of the failure of U.S. regulated banks is not the norm - nonetheless, we stand behind all #USDC in circulation. https://www.circle.com/...
  • @evgenygaevoy @evgenygaevoy on x
    Great update from Jeremy. Some tldr (as I see it) and some thoughts (as I think them) all opinions are mine, Wintermute has exposure to USDC and this is ongoing volatile situation that will continue until banks are open on Monday (and potentially beyond) https://twitter.com/...
  • @mikeisaac Rat King on x
    tradfi vs defi... w/@yaffebellany @eringriffith https://www.nytimes.com/...
  • @lexnfx Alexei Oreskovic on x
    Silicon Valley Bank's collapse is already causing collateral damage that's sinking stablecoin values and delaying paychecks https://fortune.com/...
  • @allnick @allnick on x
    Anybody who understands economics saw that rising interest rates caused SBF to defraud customers of $8B Hence USDC. Hence Moonbirds. Hence no smart economists. #math
  • @pitdesi Sheel Mohnot on x
    2nd order effect: Stablecoin USDC has lost its peg to the dollar (which it held constantly) and has been trading around $0.90 this morning. $3.3B of the $40B USDC reserves were held at SVB. Only a small portion is likely at risk so this feels like an overreaction. https://twitter…
  • @wublockchain Wu Blockchain on x
    MakerDAO launched an emergency proposal about USDC to limit Maker's exposure to potentially impaired stablecoins and other risky collaterals, while maintaining enough liquidity to prevent DAI from trading significantly above $1 if conditions change, and https://forum.makerdao.com…
  • @edzitron Ed Zitron on x
    I've already posted the smiling man so many times today but let's just say that USDC is not looking so good. It is not looking so hot no https://twitter.com/...
  • @Jhorwitzz@mastodon.online Jeff Horwitz on mastodon
    Could be my small network, but this platform seems to be doing a lot less fighting over entirely theoretical haircuts to SVB depositors than another platform is.
  • @stevetex@mastodon.social Steve Teixeira on mastodon
    It's pre-bankrupted, which would save him a lot of time  —  https://www.businessinsider.com/ ...
  • @moshaikhs Mo Shaikh on x
    A shockwave through the US financial system is a good reminder to take a breath and consider the benefits of decentralization. Time to do the work to make our systems more transparent. 🛠️ These glitches are a call to action for different industries to come together to fix... http…
  • @berkeleylaw @berkeleylaw on x
    “SVB's rollout, for whatever reason, was poorly timed,” said @adambsterling, assistant dean at Berkeley Law. “Everyone was already fidgety after Silvergate's collapse.” via @NYTimes https://www.nytimes.com/...
  • @w3sobeefy @w3sobeefy on x
    A bank collapses because of rising interest rates and bad positioning. New York Times: It's the crypto bros fault. https://twitter.com/...
  • @carnage4life Dare Obasanjo on x
    The difference between a bank failure and a crypto project failure is that when a regulated bank fails, you aren't able to get your money back right now. When a crypto project fails, you aren't getting your money back. A lot of SVB hot takes think banks are like crypto schemes.
  • @hblodget Henry Blodget on x
    Yes, crypto enterprises never fail... ;-) https://twitter.com/...
  • @chasemadar Chase Madar on x
    These fleece-vested Overtwerps, who would not exist but for DoD spending, will blame everything and everyone except insufficient federal bank regulation https://www.nytimes.com/...
  • @jossytweets Jocelyn on x
    If you think #cryptocurrency has nothing to do with #SiliconValleyBank's failure, you're not paying attention. https://www.nytimes.com/...
  • @matthew_d_green Matthew Green on x
    I guess stablecoins are only stable on weekdays.
  • @petergyang Peter Yang on x
    2/ USDC had a market cap of over $40B just a few days ago. This has fallen by over 14% after concerned investors redeemed $1B+ in USDC on Friday. Major exchanges like Coinbase have temporary paused USDC:USD conversions due to this volatility. https://twitter.com/...
  • @laurenshirsch Lauren Hirsch on x
    Per new bankruptcy filing, BlockFi has $227m in Silicon Valley Bank. The bankruptcy trustee warned them on Mon that bc those funds are in a money market mutual fund, they're not FDIC secured — which could be a prblm w/ keeping in compliance of bankruptcy law https://twitter.com/.…
  • @justafamilyman_ @justafamilyman_ on x
    BlockFi is the gift that keeps on giving and not in a good way. This is a mess of epic proportions. smh https://twitter.com/...
  • @frances_coppola Frances ‘Cassandra’ Coppola on x
    “FDIC secured” is meaningless anyway for that amount of money. The FDIC limit is $250k. https://twitter.com/...
  • @bowtiedbull @bowtiedbull on x
    Thanks for playing. Hope you enjoyed your 2% “extra” return for that 12 month period. https://twitter.com/...