In a recent update on the USDC thread, Jeremy Allaire, the Co-founder, and CEO of Circle, announced that they will be bringing on a new transaction banking partner with automated minting and redemption as soon as possible.
This announcement comes after the closure of Signature Bank, which means that Circle will not be able to process minting and redemption through SigNet and will instead be relying on settlements through BNY Mellon.
Allaire also stated that Circle is committed to building robust and automated USDC settlement and reserve operations with the highest quality and transparency.
He also highlighted the need for a truly safe financial system, advocating for full-reserve digital currency banking that insulates their “base layer of internet money and payment systems from fractional reserve banking risk. “
Allaire emphasized the importance of the Payment Stablecoin Act, which is currently being pursued by Congress and would enshrine in law a regime where stablecoin funds would be held with cash at the Fed and short-term T-Bills.
Later, Allaire tweeted that Circle’s USDC operations will open for business from Monday morning, including with new automated settlement via their new partnership with Cross River Bank.
According to a blog post, all depositors with Silicon Valley Bank and Signature Bank will be made whole, and the $3.3B USDC reserve deposit held at Silicon Valley Bank will be fully available when U.S. banks open the next day.
Circle’s Priority On Trust, Safety, & 1:1 Redeemability Of USDC
Circle has announced its dedication to expanding its banking partnerships and has introduced automated USDC minting and redemption for customers through new banking partners that are scheduled to launch this week.
Allaire, CEO of Circle, emphasized that the trust, safety, and 1:1 redeemability of all USDC in circulation remain their utmost priority, even in light of bank contagion that can affect the crypto markets.
He has also provided more information on the USDC reserve, stating that it is currently backed by 77% ($32.4B) of short-term U.S. Treasury Bills. These reserves are securely held in custody by BNY Mellon, and the remaining 23% ($9.7B) of the USDC reserve is predominantly held at BNY Mellon as well.
Circle CEO further highlighted that the entire liquidity ladder down to the CUSIP number on T-Bills could be viewed by anyone via the USDXX ticker, and monthly USDC attestation reports are readily accessible on Circle’s website.
Nevertheless, Circle is taking steps to ensure the safety and security of its USDC reserves and operations in light of recent bank closures. They are committed to building a robust and automated USDC settlement and reserve system and advocating for full-reserve digital currency banking.
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