Circle has revealed that Cross River Bank — recognized for its services to fintech and crypto firms like Visa and Coinbase — is now its new commercial banking partner for producing and redeeming USD Coin. In addition, Circle has “expanded relationships” with other banking partners to assist with USDC redemption, including Bank of New York Mellon (BNY Mellon), which already provides custody services for Circle’s reserves.
Surviving a harrowing weekend that saw Circle’s flagship USDC stablecoin break its peg to the dollar, falling below $0.90 early on Saturday before a series of moves by banks and regulators restored confidence in the token. At the time of publication, USDC has recovered and trades at $0.99.
During the weekend, Circle issued a press release confirming 100% of USDC reserves are safe and secure. The company said it would complete the transfer of the remaining Silicon Valley Bank (SVB) cash to BNY Mellon, and liquidity operations for USDC will resume at banking open on Monday.
Circle’s announcement noted that it had no exposure to Silvergate, the crypto-friendly bank that announced it would voluntarily liquidate its holdings as part of a takeover process by federal regulators.
This weekend’s USDC turmoil was part of a broader financial catastrophe that started due to the collapse of SVB, the 16th-largest bank in the United States and a financial pillar of the tech and venture capital world.
The failure of SVB triggered a panic as thousands of companies, including Circle, could not access billions in deposits. However, the Federal Reserve and other agencies calmed markets by announcing depositors at SBV would be made whole.