🔥 USDC Severely Depegging: Crypto Contagion Spreading! 🚨
Updated
The USDC stablecoin, once argued to be the 'safest' of all stablecoins, is currently depegging against the nominal $1 value.
The reason behind the initial depeg was caused by the news that Circle, USDC's parent company, has part of her funds stalled at the recently defaulted SSIVB Silicon Valley Bank, which would in turn mean that a lot of USDC's backing has vanished.
This depeg was exacerbated by Coinbase pausing the USDC <> USD conversions. This spooked the market and is currently causing a lot of distress among investors, look at BTC's chart for example.
Should you sell your USDC? Likely not. In the chart below you can see that depegs like the current one have happened before. In 2021 the depeg was even worse at one point. If history is any indication, this will blow over just like it always has been for USDC and USDT.
Furthermore, according to the first tweet, only 8% of USDC's backing funds have been lost with the SSIVB collapse, which should not be that much of an issue.
However, if other crypto-related banks will default in the near future, the depeg can get worse very quickly.
Please share your thoughts below🙏
The reason behind the initial depeg was caused by the news that Circle, USDC's parent company, has part of her funds stalled at the recently defaulted SSIVB Silicon Valley Bank, which would in turn mean that a lot of USDC's backing has vanished.
This depeg was exacerbated by Coinbase pausing the USDC <> USD conversions. This spooked the market and is currently causing a lot of distress among investors, look at BTC's chart for example.
Should you sell your USDC? Likely not. In the chart below you can see that depegs like the current one have happened before. In 2021 the depeg was even worse at one point. If history is any indication, this will blow over just like it always has been for USDC and USDT.
Furthermore, according to the first tweet, only 8% of USDC's backing funds have been lost with the SSIVB collapse, which should not be that much of an issue.
However, if other crypto-related banks will default in the near future, the depeg can get worse very quickly.
Please share your thoughts below🙏
Note
USDC has, as expected, almost repegged. With the FED bailing out 
SVB their funds are safe.
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