Circle Redeems $2.9B USDC And Strengthens Reserve With BNY Mellon Partnership

Key Points:

• Circle has redeemed $2.9B and minted $0.7B in new USDC after disruptions from transaction banking partners.
• The firm has strengthened the USDC reserve by holding the majority at BNY Mellon, with a fund managed by BlackRock primarily invested in short-dated US Treasuries.

Circle, the issuer of USDC stablecoin, has announced that it has successfully redeemed $2.9 billion in USDC and minted $0.7 billion in new USDC. The announcement comes after Signature Bank’s and Silvergate Bank’s failures, which disrupted Circle’s core transaction banking partners.

The company has been working to restore USDC liquidity operations and bring on new transaction banking partners to ensure the stability of the USDC ecosystem.

To strengthen the USDC reserve, Circle has taken initiatives to hold the cash portion of the reserve at BNY Mellon, with limited funds held at transaction banking partners for USDC minting and redemption. The majority of the reserve is invested in the Circle Reserve Fund, which is managed by BlackRock and custodied at BNY Mellon. The fund is primarily comprised of short-dated US Treasuries.

The stability of the US banking system is crucial for the operations of every fiat-backed stablecoin, and the US government’s actions on Sunday, March 12, to ensure that depositors were not harmed by the failures of Silicon Valley Bank and Signature Bank highlight the importance of this. Circle recognizes the significance of a stable banking system and is working tirelessly to ensure the stability of USDC, one of the most popular stablecoins in the world.

Circle plans to add new transaction banking partners with 24/7/365 capability to strengthen the USDC ecosystem further. The company is working to process the minting and redemption requests backlog and will keep the community updated on its progress.

Overall, Circle’s successful redemption and minting of USDC and its initiatives to strengthen the USDC reserve are positive developments for the stablecoin ecosystem. The company’s efforts to ensure the stability of USDC reflect its commitment to building a more secure and reliable financial infrastructure for the crypto industry.

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