In its latest report, cryptocurrency company Circle said that it issued 700 million USDC between April 20 and April 27, reducing its liquidity by approximately 500 million USD by repurchasing 1.1 billion USDC.
USDC Announces $30.7 Billion Reserve and $30.5 Billion Token Liquidity
As of April 27, total USDC liquidity was announced as $30.5 billion, reserves at $30.7 billion, of which $5.2 billion in cash and $25.5 billion in short-term US Treasury bonds.
USDC's depegging event occurred on March 11, 2023, when the price of USDC, a stablecoin pegged to the US dollar, fell as low as $0.82 on some exchanges.
The price of the token plunged after Circle, the company that launched the USDC, announced that $3.3 billion worth of cash reserves backing USDC continued to be held at Silicon Valley Bank, which was shut down by financial regulators after a bank operation.
Circle said its operations were normal and had enough reserves to buy back all circulating USDC, but some users panicked and sold their USDC at a discount.
Circle resolved the issue by promising to make up for shortfalls in its reserves and switching to Customers Bank for USDC payment processing.
Circle also hopes that USDC users will eventually operate outside of the traditional banking system and keep their working capital in on-chain blockchain treasuries that are not subject to banking hours.
*Not investment advice.
