Circle Burns $2.34 Billion in USDC Tokens in 24 Hours
Nansen, a crypto analytics firm, has reported that Circle, the co-founder of USDC, has burned $2.34 billion worth of USDC stablecoins in the past 24 hours. The majority of the burn, about 70% or $1.65 billion, occurred in the last 8 hours alone. This news comes amid concerns over the solvency of Silicon Valley Bank (SVB), where $3.3 billion worth of USDC reserves remain.
Circle has burned $2.34 billion $USDC in the last 24 hours
About 70% ($1.65 billion) was burned in the last 8 hours alone pic.twitter.com/qwkfYpZEN7
— Nansen 🧭 (@nansen_ai) March 11, 2023
According to Nansen’s data, Binance currently holds the largest amount of Ethereum-based USDC with $5 billion, followed by Crypto.com with $766 million, Uniswap with $653 million, Voyager with $529 million, Curve with $515 million, and dYdX with $368 million. However, the firm also notes that there has been a net increase of approximately $366 million USDC minted during this period, including $12.2 million minted just 38 minutes before the report was published.
Circle’s recent USDC burn is likely an effort to reduce the total supply of the stablecoin, which currently stands at around $12 billion. The move is intended to maintain the peg of USDC to the US dollar, as the supply of stablecoins can impact their price stability. While Circle has assured investors that their USDC holdings remain secure, the news of the burn and the concerns over SVB’s solvency have raised questions about the stability of stablecoins.
As we previously reported, Circle has called for the continuity of SVB, emphasizing the bank’s importance in the US economy. The company has also stated that they will follow the guidance provided by state and federal regulators regarding the situation. However, the news has raised concerns among investors about the potential impact on USDC and other stablecoins, which rely on stable reserves to maintain their value and stability.
As the stablecoin market continues to grow, it will be important for investors to monitor developments closely and remain aware of potential risks. While stablecoins offer many benefits, they also come with unique challenges and risks that must be carefully considered. As always, investors should conduct thorough research and exercise caution before investing in any crypto assets.
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