Don’t Panic: ‘Circle Will Stand Behind USDC and Cover Any Shortfall’

Finally some good news about USDC and the stablecoin’s future

article-image

Grey82/Shutterstock modified by Blockworks

share

Circle has issued a statement regarding USDC and the depegging of the stablecoin following the collapse of Silicon Valley Bank (SVB).

If 100% of the $3.3 billion that Circle held at SVB at the end of business on Friday is not returned, Circle promises that “as required by law under stored-value money transmission regulation, [we] will stand behind USDC and cover any shortfall using corporate resources, involving external capital if necessary.”

The USDC stablecoin has plunged to as low as $0.87 over the last 24 hours as fears of under-collateralization have infected the market. At the time of writing, USDC was once again nearing its peg, at $0.97 and on a path to parity.

Circle noted in the statement that they believe any transfers initiated prior to the bank entering receivership should be covered under FDIC policy, and they have previously stated that they initiated such a transfer on Thursday to recover the outstanding funds held at SVB.

They have also suggested that there is a possibility that transfer is processed on Monday.

Circle also claimed that the USDC stablecoin had no exposure to Silvergate, after the crypto-friendly bank entered voluntary liquidation proceedings.

According to the Circle statement, the company holds a total of $9.7 billion in cash, mostly with BNY Mellon. A further $1 billion is held at Customers Bank, and Circle does not specify the nature of its exposure to Signature Bank. The remaining 77% of its assets are described as being held in Treasury Bills.

Jeremy Allaire, CEO of Circle, projected confidence in a tweet thread this afternoon. “Tl;Dr: While USDC can be used 24/7/365 on chain, issuance and redemption is constrained by the working hours of the U.S. banking system. USDC liquidity operations will resume as normal when banks open on Monday morning in the United States. As a practical matter, our teams are well prepared to handle significant volume, built on the strong liquidity and reserve assets discussed below. As a regulated payment token, USDC will remain redeemable 1 for 1 with the U.S. Dollar.”

Some sources are already suggesting that SVB may not infect the wider banking system, with many of the available funds potentially available for redemption in the coming week.

Loading Tweet..
Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 24 - 26, 2026

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Monad SR Report Graphic.png

Research

Monad is a new Layer 1 blockchain designed as a high performance, EVM-compatible platform.

article-image

Engineers from MetaMask, Coinbase, Google, and the Ethereum Foundation make the case for onchain AI agents via ERC-8004

article-image

Legacy payments firm partners with Anchorage Digital to issue a dollar-pegged token under new US stablecoin law

by Blockworks /
article-image

As Solana ETFs launch but network REV trends lower, Jito sits at the intersection of new capital inflows and microstructure improvements

article-image

The Truth Social parent will integrate Crypto.com Derivatives North America, allowing users to trade prediction contracts under federal oversight

by Blockworks /
article-image

Partnership surpasses $2 billion in staked assets and adds support for new Proof-of-Stake networks

by Blockworks /
article-image

The tokenization leader will merge with Cantor Equity Partners II, becoming the first public firm focused on securities tokenization

by Blockworks /