After the second largest bank crash in U.S. history, USDC and DAI stackcoins “detached” from the dollar and began to decline. SVB was the 16th largest bank in terms of assets, holding about 8% of the USDC’s secured reserves
USD Coin and DAI have become “detached” from the U.S. dollar amid the bankruptcy of Silicon Valley Bank, 16th by assets in the United States. According to Coindesk, USDC is nearing 93 cents (minus 7%), while DAI is trading below 95 cents (minus 5%).
USDC’s value fell sharply after its issuer, Circle Internet Financial, admitted that it could not withdraw its $3.3 billion reserve from SVB to secure the steblecoin rate, which is about 8% of its total assets of nearly $40 billion, the WSJ writes.
Dai is the fourth-largest stabelcoin with a market capitalization of about $5 billion, and its reserves are almost half backed by USDC.
This situation has created a strong negative around other stablcoins as well – outflows continue from all stable coins except USDT according to Coindesk data.
The bankruptcy of SVB became known on March 11 – this is the largest bankruptcy since the crisis of 2008. The bank was the 16th largest by assets in the country and was one of the most prominent lenders in the tech startup industry. In 2022 it was valued at $40 billion, and its capitalization has been growing rapidly over the last five years.