Circle CEO Jeremy Allaire has denied rumors that the USDC stablecoin is on the verge of collapse.
Jeremy Allaire shared a series of tweets on his Twitter account over the weekend. While the CEO denied rumors that USDC is on the verge of collapse; He said the company is in its strongest state ever.
Saying that the crypto community understands the anxiety, Allaire also shared his latest reports on USDC’s liquidity situation to support his statements.
8/ Circle is in the strongest position it has ever been in financially, and we will continue to increase our transparency. FWIW, we are also encouraged by emerging regulatory frameworks for stablecoin issuers, which should help further increase confidence in issuers like Circle.
— Jeremy Allaire (@jerallaire) July 2, 2022
The rumors in question were that the company was at risk of defaulting on USDC reserves due to large interest payments it had to make to crypto banks like Signature and Silvergate.
USDC, the second largest stablecoin, is used in lending activities by companies that have experienced liquidity crisis/bankruptcy such as Genesis, BlockFi, Celsius, Galaxy and Three Arrows Capital (3AC). For this reason, Allaire also explained that there is a difference between USDC’s reserves and USDC used in lending markets, and used the following statements:
“There is also an obvious conflict between USDC reserves, which are regulated, vetted, and transparent, and USDC used in lending markets outside of the Circle.”
Boston-based Circle had a valuation of $9 billion in February.
