Circle’s new statement revealed that USDC was 100% collateralized with the majority of its holdings collateralized through U.S. treasury bills. Many investors sold their USDC, some, however, bought the bottom. Over the last few days, there has been a lot of FUD surrounding Circle after the firm was impacted by the bank run on Silicon […]
Circle’s new statement revealed that USDC was 100% collateralized with the majority of its holdings collateralized through U.S. treasury bills.Over the last few days, there has been a lot ofOn 12 March, Jeremy Allaire, CEO and co-founder of Circle, tweeted Circle’sAccording to Circle’s statement, its stablecoin USDC was 100% collateralized. Based on the data provided by Circle, 77% of USDC was collateralized through U.S. Treasury Bills, which amounted to $32.4B.
It was found that out of the remaining $9.7 billion, $5.4 billion of the funds were moved to BNY Mellon, in an effort to reduce bank risk.Despite all the efforts made by the Circle team to give clarity on the matter, the FUD continued to haunt the stablecoin.One indicator of the declining interest and rise in FUD was the decreasing liquidity of USDC on Uniswap. At press time, the liquidity of USDC on the DEX reached a 2-year low of $85,190,702.41.
As the skepticism against USDC began to rise, the interest in other alternative stablecoins such as USDT and DAI, went uphill. According to Santiment’s data, the overall market cap for DAI and USDT surged by 6.8% and 1.2%, respectively. However, USDC continued to lose its footing as its market cap fell by 8.1% during the same period.One of the reasons for the sharp decline in USDC’s market cap was the behavior of various large-scale funds and investors.
But it wasn’t just the funds that were exiting their positions, the likes of Justin Sun also got involved.On the other hand, investors such as Vitalik Buterin and firms like Taureon Capital, showed immense faith in the stablecoin and bought USDC at the bottom.
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