USDC Price De-pegged Below $1
On Friday, USDC stablecoin de-pegged from its intended $1 price after Silicon Valley Bank (SVB) was closed by regulators. In a blog post, Circle said it would use its corporate resources and external capital, if required, to back USDC.
Circle had been holding $3.3 billion in USDC cash reserve at the Silicon Valley bank when the FDIC seized the bank's assets on Friday.
The company stated that it had attempted to transfer its assets before the bank's collapse and that the transaction could settle on Monday when US banks would resume normal operations.
However, Circle acknowledged the possibility that SVB might not return 100% of its assets, and it may take some time for any return, as the FDIC issues IOUs and advanced dividends to deposit holders.
According to Coingecko, the USDC price fell as low as $0.88 before rebounding to $0.97 after the announcement.
DEX witnessed ATH in trading volumes
As a result of USDC price de-pegging from $1, crypto firms such as Binance, Crypto.com, Coinbase, and Bitpay paused USDC transactions and auto conversions. However, despite crypto companies halting transactions, the stablecoin accounted for 29% of the $90.70B global crypto trades.
Over the weekend, decentralized exchanges (DEX) Uniswap and Curve witnessed a surge in trading volumes, hitting all-time highs, as traders rushed to exchange their token holdings, particularly USD coin, with other tokens.
Uniswap processed nearly $12 billion in trading volume over 24 hours from Saturday to Sunday.
According to Dune Analytics data, USDC pools for wrapped Ether (WETH), Tether (USDT), and Dai (DAI) generated $15 billion in volume over seven days. The majority of this occurred from Friday to Sunday, generating over $8 million in fees for the Uniswap protocol, adding to Uniswap Labs' revenue, with a smaller percentage paid to liquidity providers.
Furthermore, stablecoin swapping tool Curve recorded almost $8 billion in trading volume, with one of its popular pools being imbalanced due to the rush of traders exchanging USDC for other tokens.
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