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My instinctive thought is that the responsible thing to do here is to pause redemptions for a while to see how the SVB thing plays out and then lower the face v
by im3w1l 4y ago
My instinctive thought is that the responsible thing to do here is to pause redemptions for a while to see how the SVB thing plays out and then lower the face value of the usdc to align with their reserves.
- curiousgal 4y ago> reserves So likely 0?
- lkbm 4y agoThe thing that caused this was the news that they have at least $3.3B in reserves. SVB uninsured deposits aren't dropping to zero, or anywhere close.
- im3w1l 4y agoThe article mentions that only 3.3B out of 40B of reserves were in SVB in the first place. I'm not too well-read on the SVB situation but some of those 3.3B may additionally be recovered.
- koolba 4y agoLowering face value is not an option if they intend on being a going concern. Their core business is maintaining something that's worth a dollar and they can't do that, then the market will move on to other things. It'll be permanently an unwinding operation. Their best play right now would be to find some big pocketed investors with on chain assets. Have them buy USDC on-chain for $.90 on the dollar, write off the $1 redemption value with a $.10 bonus, and defer redemption on those tokens until they figure out the liquidity situation. It'd be a crazy bet and requires on-chain assets to kick start it, but the investors would be making a decent return in exchange for delaying their redemptions.
- hd95489 4y agoWould you take that bet? It’s likely that the exposure is similar in nature for their other assets