Circle and Sequoia had been amongst best depositors at Silicon Valley Bank: Report

6:19 am
June 24, 2023
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Stablecoin issuer Circle and mission capital company Sequoia Capital had been reportedly a few of the best 10 depositors on the collapsed crypto-friendly Silicon Valley Bank (SVB) in March.

According to a June 23 record from Bloomberg, the Federal Deposit Insurance Corporation (FDIC) provided paperwork suggesting that Circle, Sequoia and others had been lined for deposits within the billions of bucks. The Federal Reserve introduced following the SVB cave in that it will paintings with the FDIC to make each insured and uninsured depositors complete — in maximum eventualities, the FDIC handiest insures as much as $250,000 according to depositor.

Circle reportedly held kind of $3.3 billion in deposits, whilst Sequoia had kind of $1 billion. Other main depositors integrated Silicon Valley Bank itself, SVB Financial Group, biotechnology analysis company Altos Labs and Kanzhun Limited, a China-based corporate in the back of a significant on-line recruitment platform.

Related: Circle CEO blames US crypto crackdown for declining USDC marketplace cap

The failure of SVB and the following collapses of Signature Bank and First Republic Bank has put a focus on how regulators within the United States care for deposit insurance coverage. Though the Fed, FDIC and Treasury Department mentioned protecting SVB and Signature deposits of greater than $250,000 used to be a part of a “systemic risk exception,” they’ve reportedly explored elevating the insurance coverage restrict.

Following the failure of SVB in March and Circle confirming it had kind of $3.3 billion in publicity to the financial institution, the company’s USD Coin (USDC) in brief depegged from the U.S. greenback. In June, the stablecoin issuer introduced it deliberate to release a local model of USDC at the Arbitrum community.

Magazine: Unstablecoins: Depegging, financial institution runs and different dangers loom