Circle revealed that Cross River Bank best known for its services to fintech and crypto companies such as Visa and Coinbase is now its new merchant banking partner to produce and exchange USDC.
Additionally, Circle has “expanded relationships” with other banking partners to assist with USDC redemptions, including BNY Mellon, which already provides custody for Circle’s reserves. After a painful weekend, Circle's flagship USDC stablecoin broke its peg to the U.S. dollar, dipping below $0.90 early Saturday, following a series of moves by banks and regulators that revived the token. Confidence. At the time of publication, USDC has recovered and is trading at $0.99.
Over the weekend, Circle issued a press release confirming that 100% of USDC reserves are safe and secure. The company said it will complete the transfer of remaining Silicon Valley Bank (SVB) cash to BNY Mellon and that liquidity operations in USDC will resume when the bank opens on Monday. Circle’s announcement noted that it had no contact with Silvergate, the crypto-friendly bank that announced it would voluntarily liquidate its holdings as part of the receivership process with federal regulators.
This weekend’s USDC turmoil is part of a wider financial disaster that began with the collapse of SVB, the 16th largest bank in the United States and a financial mainstay in the tech and venture capital worlds.
The failure of SVB sparked panic as thousands of companies, including Circle, were denied access to billions of dollars in deposits. However, the Fed and others calmed markets by announcing that SBV depositors would all be wiped out.
