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Well the point is that it isn't supposed to matter. If they're backed 1:1 as claimed (BIG IF). Technically, anyone left holding a USDC should be allowed to go
by irjustin 4y ago
Well the point is that it isn't supposed to matter. If they're backed 1:1 as claimed (BIG IF).
Technically, anyone left holding a USDC should be allowed to go to Circle and say HEY give me $1 for each.
Let's see how that goes. Stablecoins am I right?
- badloginagain 4y agoIf they lost $3.3b, it's what, .9175 : 1 ? So nominal price should be $.9175 on the dollar presumably. Add in another couple bips for the uncertainty. Edit: It would be actually hilarious if USDC failed because the banking system. I doubt it will happen, you'd have to see further contagion from the other banks Circle uses for their dollar reserves. I figure the tipping point for a bank run is quite high?
- brookst 4y agoI don’t think it’s remotely plausible that uninsured SVB deposited are just gone, $0 on the dollar. Absolute worst case, they might have lost 10%, or $330m, so .99175. It’s not like SVB was a Madoff scheme and the money is gone; it became insolvent because the current value of its investment vehicles couldn’t support 100% withdrawals.
- ejanus 4y agoBased on their own story. However wait for regulators to look at their books first before concluding .
- xuki 4y agoIt's 1:1 until they cannot process withdrawals anymore then it's 0:1. If I had any money in USDC right now I would try to withdraw asap.
- panphora 4y agoThis assumes their reserves can be liquidated 1:1 in time of panic instead of taking a massive haircut Also, missing 5% of their reserves means the first 95% of withdrawals get 100% of their money and the last 5% get 0%... Hence the bankruns on Silvergate, Silicon Valley Bank, and now USDC