Circle continues to increase reserves for USDC


The news that Circle itself provides us with in its latest report on the management of the newborn reserve fund is well received by investors both in the stable USDC and in the crypto world in general who see the entry of banks into the sector as an operation of transparency . 

Circle is a company founded ten years ago (2013) by Jeremy Allaire and Sean Neville, it deals with peer to peer payments and its stablecoin is USDC. 

Circle wanted to intervene by communicating the beginning of some “anomalous” relationships for a crypto company but which the community of this fantastic asset welcomed very favorably, recognizing the move as a sign of openness and transparency. 

Circle: BlackRock manages 30% of USDC reserves

The company, in its latest report reveals how 75% of the reserve fund (Circle Reserve) is made up of US treasury bonds and 12.79 billion dollars are in the hands of the investment bank BlackRock (NYSE: BLK).

Circle according to issued attestation report has 30% of USDC reserves.

From early October of the year just ended to New Year’s Eve, the American company had set aside 43.4 billion dollars of USDC reserves against a working capital of 43.23 billion USDC . 

32.2 billion (75%) of the total reserves consist of treasury bills of the United States of America while 11.15 billion are I’m fiat currency collateral with the most accredited banks in the country.

The Circle Reserve Fund was created to guarantee the stability of the Circle project and partly as collateral for the stablecoin in early November last year and holds $28.6 billion (65%) of the crypto. 

BlackRock’s intervention in the fund has caused an uproar in the cryptocurrency world and John Paul Koning, a well-known analyst, wanted to underline how the bank’s intervention is a sign of maturity of the asset and good for USDC investors . 

Speaking on the subject John Paul Koning expressed himself with a tweet in these terms from his profile:

“It looks like a win for USDC users. Circle is giving up some of its control over USDC’s reserves to an outside manager subject to SEC regulation, which ultimately makes USDC safer. Transparency also improves, as USDC users can now receive regular updates from BlackRock.” 

The fiat currency part of the collateral is not exclusive to BlackRock, indeed since its intervention Circle has continued the practice involving the most important American banks. 

U.S. lenders where the company holds foreign exchange reserves include Bank of New York Mellon (NYSE: BK), Citizens Trust Bank, Customers Bank, New York Community Bank, Signature Bank (NASDAQ: SBNY) , the Silicon Valley Bank and finally the Silvergate Bank.

The move to involve BlackRock in the management of the Circle Reserve Fund is an opening which, in the opinion of the best-known analysts, makes Circle and its stable USDC a safer investment than it was in the past and due to the regulations to which it indirectly submits opening to banks is also more transparent. 

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