Circle Assures $1 Redemption, Reveals USDC Reserves

Circle assures that USDC holders will be able to redeem $1 for every USDC they have.
Circle will use corporate resources including external capital to make up for $3.3 billion with Silicon Valley Bank.
Majority of Circle’s cash reserve is with BNY Mellon, while $1 billion is with Customers Bank.

Circle USD (USDC) users will be able to redeem $1 for every USDC they have, according to an announcement by its issuing company a couple of hours ago.

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The recent bank run of Silicon Valley Bank (SVB) caused many companies that have exposure to it to become subject to massive worry and exodus. Unfortunately, Circle is one of them. However, the company assures that once regular banking operations resume on Monday, USDC holders can exchange their stablecoin for US dollars at a 1:1 ratio.

Circle also revealed its USDC reserves. Specifically, $32.4 billion is in US Treasury bills while $9.7 billion is in cash held in other banking partners. Some of these include BNY Mellon — one of the largest banks in the world — holding $5.4 billion; Customers Bank holding $1 billion; and the remaining $3.3 billion with SVB.

At the moment, SVB’s fate is being determined by the Federal Deposit Insurance Corporation (FDIC). Circle “hopes” that the FDIC will come up with a solution to help customers get back 100% of their money.

Uinvest founder Gurgavin Chandhoke also shared that the FDIC is planning to return some uninsured SVB deposits this money. However, it is not clear how much percentage will be given back or if it will be 100%.

As seen in the tweet above, SVB CEO Gregory Becker posted a message to all employees, expressing his sympathy for their plight. However, he has yet to reveal any conclusive information about the state of the bank and how things will fare soon.

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Jesus Dawal Jr covers news related to the crypto space in Asia and in Australia, although he follows the latest events in the US and Europe as well. He is most interested in the blockchain gaming and regulation aspects of the industry.