"SVB" collapse leads to 10% drop in "USDC" stable currency.
US crypto firm Circle reported on Mar 10 that it couldn't withdraw $3.3B of $40B USDC reserves from the failed Silicon Valley Bank. This news caused USDC to drop 10% in value initially and 8.3% today, trading at $0.9. The collapse of the bank on Mar 11 is considered the biggest since the 2008 financial crisis. Circle also moved some USDC reserve deposits from Silvergate to other banking partners.
This news caused widespread selling and a decline in trading activity for the USDC. As a result, investors and traders who were holding USDC suffered a loss in value. The collapse has raised concerns about the safety and stability of stablecoins and highlights the importance of ensuring that stablecoin reserves are held in reliable and secure financial institutions.
USDC has fallen below 90 cents, and traders are reportedly fleeing to other stablecoins to protect capital. While there is currently no clear indication of when or if USDC will recover, traders are betting on a potential rebound for the stablecoin.
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