Circle Clears “Substantially All” USDC Redemption Backlog
- Despite the events of last week, Circle has been able to clear almost all USDC backlog, and redeemed $3.8 billions USDC between March 13 and March 15.
- The stablecoin issuer also went live with a new transaction banking partner for both domestic and international wires, and expects to bring more capabilities back soon.
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Stablecoin issuer Circle claims to have cleared “substantially all” backlog requests for minting and redemption of the USD Coin (USDC) stablecoin, the company said in an operational update on 15 March.
According to the announcement, despite the events of last week — which impacted the liquidity operations for USDC — Circle was still able to redeem $3.8 billion and minted $0.8 billion USDC between Monday morning and the close if banking business in the U.S. on 15 March. With this, the stablecoin issuer has now cleared almost cleated the backlog of minting and redemption requests for the stablecoin. The company wrote:
“The events of the past week have impacted the liquidity operations for USDC. Circle has worked tirelessly to re-initiate services with alternative banking partners, particularly payment and USDC redemption services. We would like to thank our customers for their patience during these unprecedented times.”
Circle’s troubles began last week after Silicon Valley Bank (SVB) was shut down by California’s financial watchdog. The next day the stablecoin issuer revealed that it could not withdraw around $3.3 billion out of its $40 billion USDC reserves from SVB, which caused a bank run and resulted in USDC losing its peg to the U.S. dollar. Circle’s situation became even worse on 13 March, when Signature Bank — which processed minting and redemption of USDC through SigNet — was also shut down by the NYDFS.
The firm worked quickly over the weekend, and on 13 March announced that Cross River Bank — which also provides services to crypto exchange Coinbase — had become its new banking partner for minting and redeeming USDC. The company also noted that it had expanded its ties with the Bank of New York Mellon (BNY Mellon), which was the primary custodian of the USDC reserves.
On 14 March the stablecoin issuer said it went live with a new banking partner for U.S. wires, and on 15 March revealed it had used the same partner for international wires “to and from 19 countries”. Circle also expects to “bring more capabilities” back online in the near future.
- The digital ID project said Orb Operators received USDC payments as part of the project’s transitional phase after launch, and now that it is nearing its end Worldcoin will be switching to WLD payments.
- Worldcoin warned Orb Operators to check if they can claim rewards in their region as WLD are not available in the United States and “certain other restricted territories”.
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- SVB Financial Group has filed for a Chapter 11 court-supervised reorganization in the U.S. in order to “preserve value”.
- The company stressed it is no longer affiliated with Silicon Valley Bank, the closure of which sent ripples across the crypto industry.
- NYDFS took possession of Signature in order to protect the economy and strengthen the confidence in the banking system, and assured customers that all deposits will be returned.
- The price of USDC also started to recover after its issuer, Circle, revealed that all stablecoin reserves held at Silicon Valley Bank (SVB) were safe, and that the company had new banking partners.