• Loading stock data...
Business Finance

Major crypto coins stabilise after U.S. intervenes on SVB collapse

Major cryptocurrencies stabilised on Monday after U.S. authorities announced plans to limit the fallout from the collapse of Silicon Valley Bank (SVB) and the issuer of the USD Coin stablecoin said it remained redeemable with the dollar.

U.S. authorities launched emergency measures on Sunday to shore up confidence in the banking system after the failure of SVB threatened to trigger a broader financial, and said SVB customers would have access to their deposits from Monday.

USD Coin, also known as USDC , recovered to $0.998, up from a record low of $0.87 hit on Saturday, far below its intended peg of 1:1 against the dollar. The fall was sparked by concerns on the exposure of Circle — the U.S. firm that issues USDC — to SVB.

Top cryptocurrency bitcoin , meanwhile, gained 6% to $23,350, a recovery of over 13% from its lows hit a day earlier.

Jeremy Allaire, CEO of USDC issuer Circle, said in a tweet on Sunday that the company’s $3.3 billion USDC reserves deposit – about 8% of its total – held at SVB would be fully available when U.S. banks open on Monday.

“Circle’s USDC operations will open for business, including with new automated settlement via our new partnership with Cross River Bank,” Allaire said.

New Jersey-based Cross River did not immediately respond to a request for comment.

Stablecoins such as USDC, the second-largest by market size, are a crucial cog in the world of crypto trading. They are designed to keep a steady value, and are typically backed by reserves of traditional assets such as dollars, bonds or gold.

Stocks exposed to crypto also rallied.

Crypto miners Riot Blockchain and Marathon Digital both gained over 11%, while U.S. crypto exchange Coinbase Global added 6.3%.

Analysts, warned that market sentiment would remain skittish despite the U.S. measures.

“Markets remain unsettled from the SVB failure,” said Alvin Tan, head of FX strategy at RBC Capital Markets in Singapore. “The situation is evolving, but volatility looks set to remain elevated in coming days.”


The relief for crypto was tempered by New York’s chief financial regulator taking possession of Signature Bank, a key banking firm for crypto companies.

With the fall of SVB and California-based Silvergate Bank, its closure means that three of the main U.S. banks used by crypto businesses have failed this year.

Shares of Signature Bank were halted for trading, with U.S. officials saying depositors of Signature Bank would be made whole at no loss to the taxpayer.

Its fall represents another blow to connections between the crypto and banking sectors, already strained by a growing U.S. regulatory crackdown.

Top U.S. exchange Coinbase Global Inc tweeted on Sunday that after Signature’s fall it was “facilitating all client cash transactions with other banking partners.” According to Coinbase’s website, these are JPMorgan Chase, Cross River Bank and South Dakota-based Pathward.

Coinbase said that as of Friday’s close, it had an approximately $240 million balance in corporate cash at Signature, but expects to fully recover the funds.

Source : Reuters



About Author

Leave a comment

Your email address will not be published. Required fields are marked *

You may also like


If it doesn’t trade, is it really marketable debt?

When it comes to encouraging fiscal discipline, euro-area policymakers want the market to be part of the solution. This will
Business Technology

How to fix the European Union’s proposed Data Act

The draft European Union Data Act, proposed by the European Commission in February 2022, aims to fill a big gap in