The post Is USDC Going To “Zero” ? Major Shareholders Selling Off USDC Could Mean Total Value Drop to Zero, Says CryptoQuant Founder appeared first on Coinpedia Fintech News
The stablecoin market is in turmoil following the depegging of Circle Internet Financial’s USDC stablecoin from its intended $1 price. The event has been called a “harrowing development” for a product designed as a safe haven for investors.
Value Dropping to Zero Means Major Shareholders Are Selling
According to CryptoQuant founder Ki Young-ju, value dropping to zero means major shareholders are selling. While there is currently no on-chain proof of a USDC bank run, the situation has caused significant concern among investors.
No USDC Bank Run Found Yet, but Circle Burns $2.34B
Although no on-chain proof of a USDC bank run has been found, Circle has burned $2.34 billion in USDC in the last 24 hours. While this is a significant amount of money, it is not unusual when looking at the historical data.
According to what I’ve observed, this USDC situation is a completely different case from the UST collapse in May 2022. During the UST collapse, on-chain activities prior to the collapse indicated that LFG sent BTC to exchanges and issued infinite LUNA to restore the UST peg.
SVB Run Causes Stablecoin Price Swings and Soaring Gas Fees
Stablecoin prices have wildly swung and gas fees have soared as investors scramble to move money around in the aftermath of regulators shutting down SVB amid a run on the bank. The bank had ties to crypto, making it the second crypto-linked bank to collapse this week.
Circle Internet Financial confirmed that about $3.3 billion of the reserves backing the world’s second-largest stablecoin were tied up at SVB. Stablecoins derive their value from these reserves, and USDC’s market capitalization has now slumped below $40 billion.
USDT Spikes as Investors Shift Money Away from USDC
USDT, meanwhile, has spiked to $1.06 on Kraken versus the U.S. dollar, a level it almost never hits, as investors appear to shift money away from USDC. Bitcoin rose in response to the events.
As the stablecoin market remains in flux, investors are keeping a close eye on developments to see how they will affect the broader cryptocurrency ecosystem.
- Mobile app
- Telegram Channel
- Telegram Group
- Binance Referral Link
- Bitmex Referral Link
- (Recommended For Leverage) ByBit Referral Link
- Buy Ledger Nano at discounted price
- Buy Cool Wallets at discounted price
Don't forget to share your review/suggestions for the android app.
All In One Crypto App is an execution-only service provider. The material provided on this website is for information purposes only and should not be understood as investment advice. Any opinion that may be provided on this page does not constitute a recommendation by All In One Crypto App or its agents. We do not make any representations or warranty on the accuracy or completeness of the information that is provided on this page. If you rely on the information on this page then you do so entirely on your own risks