After dropping to $0.87 over the weekend, the stablecoin Circle USD Coin (USDC) is finally regaining parity with the US dollar, thanks to the intervention of US financial authorities who will guarantee the deposits of customers of Silicon Valley Bank, which has suddenly closed its doors.
The turbulent weekend amid the US banking crisis is reminiscent of the 2008 subprime crisis, the financial earthquake that triggered global panic and the collapse of Lehman Brothers.
By bailing out Silicon Valley Bank, where the USDC stablecoin issuer held more than $3 billion, US regulators are saving thousands of US and foreign companies from simple bankruptcy.
In view of the disastrous consequences of the fall of the Silicon Valley bank, the US central bank has found it preferable to put billions of dollars on the table to avoid a financial disaster at home and abroad.
USDC stablecoin issuer Circle CEO confirmed that USDC exchange operations will resume as usual on Monday when US banks reopen.
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Jeremy Aller mentions a new partnership with Cross River Bank in his announcement.
Circle’s US dollar operations will begin Monday morning, thanks in part to new automated settlement as part of our new partnership with Cross River Bank. https://t.co/ybkSEedzrC
— Jeremy Aller (@jerallaire) March 13, 2023
Bitcoin (BTC) price rebound
Encouraging news that is accompanied by a strong bounce in the price of bitcoin, which rose by about $22,340, click here to follow the price of bitcoin in real time.
Among other important news, Binance CEO Changpeng Zhao stated that the cryptocurrency exchange will convert $1 billion worth of BUSD stablecoins into cryptocurrencies such as Bitcoin, Ethereum (ETH), BNB.
Given the changes in stablecoins and banks, #Binance is converting the remainder of the $1 billion Industry Recovery Initiative funds from BUSD to native cryptocurrencies, including #BTC, #BNB and ETH. Some movement of funds will occur within the network. Transparency.
— Czech Republic 🔶 Binance (@cz_binance) March 13, 2023
Encouraging news after a very busy weekend in the crypto market, which feared that the USDC stablecoin would fall if Circle could not meet the demand of numerous USDC token holders wanting to return the US dollars.
A crypto sector in which 3 crypto-friendly banks disappeared in a few days: Silvergate, Silicon Valley Bank and Signature Bank, which was closed yesterday by the US authorities.
It remains to be seen how events will play out when US markets reopen on Monday, March 13, 2023.
The authorities fear that many Americans, chilled by the events of this weekend, will be tempted to withdraw their money from other banks in the US, which will again provoke a bankran (bank panic), which could lead to a new banking crisis.
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