• Silicon Valley Bank (SVB) suffered a capital crisis that triggered its second-largest collapse in U.S. history.
• This caused shockwaves through the cryptocurrency and global markets, including Circle’s $40 billion USDC reserves that remained at SVB.
• The FDIC has set up a new bank, National Bank of Santa Clara, to hold all of SVB’s assets and provide clarity on the issue for USDC holders.
Silicon Valley Bank Collapse
Silicon Valley Bank (SVB) experienced a capital crisis late Friday morning, resulting in its second-largest collapse in U.S. history and causing shockwaves throughout the cryptocurrency and global markets. With around $209 billion in assets at the end of 2022, SVB was listed as the sixteenth largest bank in the United States before it crumbled on Friday morning.
Circle’s USDC Reserves
Stablecoin issuer Circle disclosed late Friday that around $3.3 billion of its $40 billion USDC reserves remained at Silicon Valley Bank after its share price dropped precipitously due to a run on deposits by nervous consumers. With a total supply of $43.5 billion, all of which is backed by government bonds and cash equivalents, USDC is the second largest stablecoin in circulation with a market capitalization of $42.4 billion according to CoinMarketCap data as of Friday evening. The USDC also de-pegged from $1, hinting at concern over its existing reserves.
Regulators Shut Down Silicon Valley Bank
California banking regulators have shuttered Silicon Valley Bank and are now responsible for managing depositor funds according to a press statement from the Federal Deposit Insurance Corporation on Friday afternoon. The FDIC has set up a new bank called National Bank of Santa Clara which will hold all of SVB’s assets and provide stability for coin holders whose funds were remaining at SVB prior to the collapse this week..
Silvergate Loss & BitStarz Bonus
In an effort to provide clarity on this problem, Circle reported via Twitter that “following confirmation…wires initiated [on Thursday] were not yet processed…$3.3 billion [of] ~$40 billion [of] USDC remain[ed] at SVB” as of March 10th 2021 . This comes after Silvergate suffered a loss of nearly $1 Billion earlier this week triggering further concerns regarding Circle’s holdings stored within their network financial institutions like Silvergate & SVB prompting an offer from BitStarz Casino offering players bonuses up to 150% plus 100 Free Spins upon deposit today!
For now it seems that coin holders can breathe easy knowing their money is safe thanks to California banking regulators setting up National Bank of Santa Clara which will manage all deposits previously held by SVB prior to their collapse this week though only time will tell if any other issues arise concerning Circle’s holdings or other crypto related organizations being affected by these recent events