Coinbase assures recovery of customer funds, as Circle mints $407 million USDC
- US-based crypto exchange Coinbase noted that it has $240 million in corporate cash stuck at Signature Bank.
- Signature Bank follows the collapse of Silvergate and Silicon Valley Bank, making it the third traditional finance company to go bust.
- The crypto exchange announced in a statement that customer funds ‘will continue to be safe and accessible.’
The United States-based (US) crypto exchange, Coinbase, revealed that it has $240 million stuck at the now-defunct Signature Bank. This marks the collapse of the third bank last week, which started with Silvergate and was soon followed by Silicon Valley Bank (SVB).
Also read: Will Circle’s stablecoin suffer same fate as UST: Binance and Coinbase react to USDC depeg
Coinbase assures safety for customers’ funds
Coinbase, considered by many as a poster child for cryptocurrency exchanges in the US, announced earlier today that it has roughly $240 million stuck at Signature Bank. The financial platform was closed by the Federal Deposit Insurance Corporation (FDIC), which stated,
We are also announcing a similar systemic risk exception for Signature Bank, New York, New York, which was closed today by its state chartering authority. All depositors of this institution will be made whole. As with the resolution of Silicon Valley Bank, no losses will be borne by the taxpayer.
The crypto exchange stated that “all client funds continue to be safe and accessible.” This news comes after Circle, a stablecoin platform’s banking partner SVB, went bust, causing widespread panic and frenzy in the markets.
Despite the turbulence we have seen in the traditional banking sector recently, Coinbase continues to operate as usual. At Coinbase all client funds continue to be safe and accessible including USDC conversions which will resume on Monday.
— Coinbase (@coinbase) March 12, 2023
Interestingly, Coinbase is co-founder of the CENTRE Consortium, which owns and operates Circle and USDC. Due to Cricle’s $3.3 billion stuck at SVB, the USDC saw a drop in its peg to the US Dollar. This news caused a mass conversion of USDC to other stablecoins and even risky assets like Bitcoin.
However, Coinbase assured its users that “USDC conversions” would “resume on Monday.”
In addition to Coinbase, BUSD stablecoin issuer Paxos also noted that it has $250 million stuck at the shuttered Signature Bank. Paxos cites FDIC and assures that all customers will be made whole.
Circle mints $407 million USDC
In a recent development, Circle, which has $3.3 billion of customer funds stuck at the collapsed bank SVB, minted a whopping $407 million USDC, as noted by on-chain metrics platform Nansen.
The March 13 mint is the seventh-largest print from the stablecoin issuer.
Author
Akash Girimath
FXStreet
Akash Girimath is a Mechanical Engineer interested in the chaos of the financial markets. Trying to make sense of this convoluted yet fascinating space, he switched his engineering job to become a crypto reporter and analyst.
