Coinbase Halts USDC To USD Conversions Amid Crypto Turmoil

Mar. 11, 2023
Coinbase Halts USDC To USD Conversions Amid Crypto Turmoil

Cryptocurrency exchange Coinbase (COIN) has temporarily suspended conversions between its USDC stablecoin and U.S. dollars in the wake of the collapse of Silicon Valley Bank (SIVB).

The bank’s shutdown has sent shockwaves throughout the crypto industry, and Coinbase’s pause is the latest example of the chaos it has caused.

The exchange announced on Twitter the suspension, citing bank closures over the weekend as the reason for the move.Moreever, Coinbase plans to restart conversions on Monday.

UDC’s stability suffered as Silicon Valley Bank collapsed, resulting in traders redeeming $1.6B of stablecoin, causing total supply to decline.

In the late hours of the day, Circle announced that it had deposited $3.3 billion of its $40 billion stablecoin backing in a now-closed bank.

The FDIC seizing the bank and USDC temporarily losing its dollar peg leaves uncertainty about the fate of the cash.

Circle Working To Protect USDC

Circle, the issuer of USDC, is taking measures to safeguard the stablecoin from potential U.S. banking system failures. Furthermore, the company’s Chief Strategy Officer, Dante Disparte, confirmed this.

The failure of Silicon Valley Bank without a federal rescue plan will impact businesses and entrepreneurs. An individual stated this and added that the implications will have a broad impact.

Coinbase has temporarily halted conversions because banks do not transfer USD on weekends. Coinbase intends to resume the conversions as soon as banks reopen on Monday.

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Silicon Valley Bank’s collapse has led to chaos in the crypto industry. The pause in USDC to USD conversions is the latest indication of this. However,it remains to be seen how USDC and other cryptocurrencies will be impacted in the long term.


Rida Fatima

News writer
An ardent wordsmith with a rich five-year background in delving into the realms of finance and cryptocurrencies. Alongside curating captivating blogs, Unique's talents extend to crafting imaginative and engaging content.