Circle has announced Cross River Bank as its new commercial banking partner for the production and redemption of the US Dollar Coin (USDC).
Circle’s USDC operations will open for business on Monday morning, including with new automated settlement via our new partnership with Cross River Bank. https://t.co/ybkSEedzrC
— Jeremy Allaire (@jerallaire) March 13, 2023
The USDC stablecoin issuer also has strengthened its relationship with other financial partners, including Bank of New York Mellon (BNY Mellon), which currently provides custody services for Circle’s reserves to facilitate the redemption of USDC, and BlackRock, which manages transactions related to its reserves.
Circle experienced a challenging weekend when the USDC stablecoin temporarily fell below 90 cents against the US dollar. However, with the help of banks and regulatory bodies, the situation was eventually resolved, and the USDC fully regained its 1:1 peg by Sunday.
Circle announced in a press release that the $3.3 billion in Silicon Valley Bank (SVB) deposits, which formed part of the reserves supporting the USDC cryptocurrency, were safe, and the token’s 1:1 value parity with the US dollar remained unchanged.
According to a press release, Circle is committed to expanding banking partnerships and unveiling an automated USDC minting and redemption feature for users through new financial partners. This feature update is expected to go live this week.
Jeremy Allaire, Co-founder and CEO of Circle, stated:
“Trust, safety and 1:1 redeemability of all USDC in circulation is of paramount importance to Circle, even in the face of bank contagion affecting crypto markets.”
Allaire noted it’s encouraging to witness significant measures taken by the US government and financial regulators to minimize the risks associated with the banking system. Additionally, Allaire expressed their longstanding support for full-reserve digital currency banking as it safeguards their foundational internet money and payment systems from the dangers associated with fractional reserve banking.
The collapse of Silicon Valley Bank(SVB) on Friday caused panic in the markets as thousands of businesses, including Circle, could not access billions of dollars in deposits. However, the timely announcement that the Federal Reserve and other agencies would compensate SVB depositors brought calm.
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