Circle Internet Financial has promised to resume normal USDC liquidity operations from Monday, enabling the redemption of the troubled stablecoin at 1:1 with the United States dollar. This is after the company devised a plan to use its “corporate resources” to cover any shortfall in its reserves following the sudden closure of the Silicon Valley Bank (SVB).
Circle Says USDC Will Remain Redeemable 1 For 1 With U.S. Dollar
Circle intends to use corporate funds to fill the gap, including external capital on the back of Silicon Valley Bank’s shutdown.
On Friday, Circle disclosed that $3.3 billion of the cash reserves backing US Dollar Coin (USDC), the second-largest stablecoin by market cap, were stuck at the shuttered SVB. The company is “hopeful” that the Federal Deposit Insurance Corporation (FDIC) will get a quick buyer for SVB that will ensure that “all depositors are made whole,” according to a សេចក្តីថ្លែងការណ៍.
But in the case that Circle does not receive 100% of the $3.3 billion held at SVB, the stablecoin issuer has assured that it will cover the shortfall “using corporate resources, involving external capital if necessary.”
Source: https://zycrypto.com/circle-pledges-to-stand-behind-usdc-and-cover-missing-liquidity-in-failed-silicon-valley-bank/