The USDC stablecoin continued this Sunday below parity against the US dollar and continues with digits in red after the banking crash Silicon Valleywhich caused an earthquake in the American financial system and threatens the development and continuity of a large group of technology startups.
This Saturday the USD coin it hit all-time lows after the bankruptcy of the bank specializing in risky investments by technology companies. The reason is that the company Circlewhich acts as a backer for the stablecoin, had about 3.3 billion USD deposited of the $40,000 million she has in her wallet.
Thus, the USDC, whose particularity is to maintain a stable value against the North American currency and which represents an alternative investment widely used in Argentinabroke through its parity with the dollar on Saturday and hit a low of $0.88. As of midday last Sunday, the stablecoin was still in the red and trading below par. $0.96according Yahoo finance. Throughout the day, he touched a minimum of $0.947.
Despite Circle indicating that it would continue to operate “normally”, the fear led other companies in the sector such as Binance and Tether to issue statements assuring their customers that they were not exposed to SVB. .
USDT, primarily, has a wide reach among Argentinian investors and financial institutions that operate with dollars in the informal market. To a lesser extent, the USDC – the currency that struggled today – also had very significant acceptance in the local crypto market.
Other crypto dollars were also affected by the SVB crash, as was USD Coin. AIDfor example, collapsed until $0.91 that Saturday and in the early hours of Sunday he found his courage and leaned towards $0.96. USDDfor his part, came to quote $0.92 and just in the last few hours it has exceeded $0.98.
Attachedfor its part, took the hit and even posted a price above par on Saturday, at $1.02which was slightly corrected this Sunday until $1.01. The one who regained parity against the American currency after losing it on Saturday was Real USDwhich in recent hours was trading again at one by one against the dollar.
The fall of Silicon Valley Bank could mean that a large group of tech startups would face serious difficulties salary payments due to the inability to withdraw the funds they had deposited in the entity.
Salary payment provider Rippling informed its customers that their processing was halted because SVB was acting as an intermediary. But it’s not just startup Rippling that’s struggling, but also a host of Silicon Valley tech companies that were SVB’s clients.
“More than half of technology companies had most of your money in SVB and they will all have to pay salaries from the start of next week,” he told the agency. BloombergGreg Martin, founder of investment firm Liquid Stock.
Some CEOs of these small and medium-sized companies in the sector will use their personal savings to pay their employees, while others are considering layoffs, among other options on the table. The Federal Deposit Insurance Corporation (FDIC), the federal authority that will serve as depository for the bank’s funds, will reopen SVB operations on Monday.
The problem is that government protection only covers insured deposits (i.e. those of less than $250,000) who are in the minority among SVB customers, estimating less than 7% of total.
Melissa Galbraith is the World News reporter for Globe Live Media. She covers all the major events happening around the World. From Europe to Americas, from Asia to Antarctica, Melissa covers it all. Never miss another Major World Event by bookmarking her author page right here.
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