Circle announced a new banking partner after Silicon Valley Bank’s failure and is expanding ties with BNY Mellon.
Circle has revealed that Cross River Bank, a bank recognized for its services to fintech firms like Visa and Coinbase, is now its new commercial banking partner for the production and redemption of USD Coin USDC $0.99 stablecoins.
In addition, Circle has established “expanded relationships” with other banking partners to assist with USDC redemption, including Bank of New York Mellon (BNY Mellon), which already provides custody services for Circle’s reserves.
Surviving a harrowing weekend that saw Circle’s flagship USDC stablecoin break its peg to the dollar, falling below 90 cents early on Saturday before a series of moves by banks and regulators restored confidence in the token. As of midnight Sunday, USDC had recovered and was trading at near exact parity with the U.S. dollar.
During the weekend, Circle put out a press release confirming that 100% of USDC reserves are safe and secure, and they will complete their transfer for the remaining Silicon Valley Bank (SVB) cash to BNY Mellon, and liquidity operations for USDC will resume at banking open today.
Circle’s announcement noted that it had no exposure to Silvergate, a crypto-friendly bank that announced that it would voluntarily liquidate its holdings as part of a takeover process by federal regulators.
This weekend’s USDC turmoil was part of a broader financial catastrophe that started due to the collapse of SVB, the sixteenth biggest bank in the country and a financial pillar of the tech and venture capital world.
The failure of SVB triggered a panic as thousands of companies, including Circle, were unable to access billions in deposits. However, the Federal Reserve and other agencies calmed markets by announcing depositors at SBV would be made whole.