In recent news, the DeFi community has been keeping a close eye on USDC, which has fallen below $0.9. According to DeFiLlama, if USDC falls to around $0.872, $45.3 million in USDC collateral will be liquidated, and most of the position is held by Aave v2 and Compound. This news has sparked concerns over the stability of the USDC stablecoin and the DeFi market as a whole.
Adding to these concerns, crypto analytics firm Nansen has reported that Circle, the co-founder of USDC, has burned $2.34 billion worth of USDC stablecoins in the past 24 hours, with the majority of the burn, about 70% or $1.65 billion, occurring in the last 8 hours alone. This move by Circle is seen as an attempt to mitigate the risks associated with the current instability of USDC.
However, this news also highlights concerns over the solvency of Silicon Valley Bank (SVB), where $3.3 billion worth of USDC reserves remain. As reported by AZCoin News, SVB has been experiencing insolvency concerns, and the fact that USDC reserves remain in the bank raises questions about the safety and stability of the stablecoin.
The DeFi market relies heavily on stablecoins like USDC, and any instability or uncertainty surrounding these coins can have significant ripple effects throughout the market. The recent developments with USDC have raised concerns among the DeFi community, and it remains to be seen how the market will respond to these developments.
As the DeFi market continues to evolve and mature, it’s crucial to maintain transparency and stability to ensure the long-term viability of the ecosystem. It’s essential for players in the market to work towards creating a more robust and secure infrastructure that can withstand market volatility and regulatory scrutiny.
Read more:
- BlockFi’s Uninsured Funds Worth $227 Million Allocated To Silicon Valley Bank’s Money Market Mutual Fund (MMMF)
- Binance Halts Auto-Conversion Of USDC To BUSD Amid Market Turmoil
- Silicon Valley’s SVB Bank Closes, Sending Shockwaves Through Startup Ecosystem