Stablecoins rally as Circle announces it will cover all USDC redemptions 1:1
Circle pledges to cover any shortfall in USDC stablecoin assets after Silicon Valley Bank collapse.
- On Saturday, March 11, Circle CEO Jeremy Allaire announced that Circle pledges to cover any shortfall in the assets backing USDC if it does not receive the entirety of a $3.3 billion cash reserve held at Silicon Valley Bank.
- USDC is a stablecoin meant to be pegged to the US dollar but fell in value after Silicon Valley Bank’s collapse.
- The value of the stablecoin fell as low as $0.88 before rebounding to $0.97 after the announcement.
- Circle said it would stand behind USDC and cover any shortfall using corporate resources, involving external capital if necessary.
- Other stablecoins, such as Dai and Gemini USD, have rallied on this news.