Circle has abandoned U.S. Treasury securities in a $24 billion reserve fund
Stablecoin USDC issuer Circle has abandoned U.S. Treasury securities in a $24 billion reserve fund
The company now holds USDC stablecoin reserves only in cash and repurchase agreements
USD Coin (USDC) Stablecoin issuer Circle has abandoned all U.S. Treasury securities in its $24 billion reserve fund. Circle now holds only cash and repurchase agreements to secure the value of the second most capitalized Stablecoin.
A REPO (Repurchase Agreement) is a sale of securities with an obligation to repurchase them within a certain period of time at a predetermined price.
USDC had a market value of $28.8 billion as of June 1, with a daily token trading volume of $3.6 billion. The token's capitalization is nearly three times that of Tether stablecoin, which has recovered to a historical high of $83.2 billion.
Circle CEO Jeremy Allaire said in early May that the company would refuse to back reserves in U.S. Treasury securities maturing after May 31 because of concerns that the government might default on its debts.
On May 29, U.S. President Joe Biden and House Speaker Kevin McCarthy finalized an agreement to suspend the national debt ceiling until January 1, 2025. The U.S. House of Representatives has already approved the bill, now it must pass the Senate
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