USDC Re-pegs After Fed’s $25B Bailout, Bitcoin Price Bounces To $22.2k
The fear, uncertainty, and doubts surrounding the second largest stablecoin USDC, issued by Circle, have significantly reduced in the past 24 hours following a bailout by the United States Federal Reserve. As a result, Circle’s USDC has re-pegged to the ratio of 1:1 with the United States dollar, following a dip towards $0.87 during the weekend.
Notably, Circle’s USDC de-pegged after the collapse of several banking institutions in the United States, including Silicon Valley Bank, Signature Bank, and Silvergate Capital, where the stablecoins’ issuer had secured part of its reserves.
According to on-chain analytics by Lookonchain, the total supply of USDC has increased by approximately $493.2 million in the past 24 hours following two whale mints on the Ethereum network.
Fed Rescues Crypto Market
The cryptocurrency market faced possible capitulation as top investors in the United States were exposed to the neo-banking crisis. Bitcoin price dropped as much as $19k during the weekend, with the altcoin market bleeding further. However, Fed’s actions have restored faith in the cryptocurrency market, which has gained approximately 8 percent to a total capitalization of about $1.06 trillion. According to our latest crypto price oracles, Bitcoin is exchanging around $22,283 during the early Asian market.
“After receiving a recommendation from the boards of the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve, Treasury Secretary Yellen, after consultation with the President, approved actions to enable the FDIC to complete its resolutions of Silicon Valley Bank and Signature Bank in a manner that fully protects all depositors, both insured and uninsured,” the United States Federal Reserve announced on Sunday.
However, the Fed has been called out for its selective bailout despite the monetary measures to reduce inflation through interest rate hikes.