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In March, stablecoin issuer Circle and venture capital firm Sequoia Capital were reportedly among the top 10 savers of the failed crypto-friendly Silicon Valley Bank (SVB).
According to a June 23 Bloomberg report, the Federal Deposit Insurance Corporation (FDIC) released documents showing that Circle, Sequoia and other companies were insured against billions of dollars in deposits. After the collapse of the SVB, the Federal Reserve announced that it would work with the FDIC to secure both insured and uninsured savers—in most cases, the FDIC only insures up to $250,000 per saver.
Circle reportedly had about $3.3 billion in deposits, while Sequoia had about $1 billion. Other major contributors were Silicon Valley Bank itself, SVB Financial Group, biotech research firm Altos Labs, and Kanzhun Limited, the Chinese company behind a major online recruitment platform.
WHOA. The FDIC accidentally posted an un-redacted document showing that the big VC firm Sequoia had $1 billion on deposit at SVB when it collapsed https://t.co/hCbcHZ0yev pic.twitter.com/Ys1qbHnvDr
— Joe Weisenthal (@TheStalwart) June 23, 2023
Related: Circle CEO Blames US for Decline in US Cryptocurrency Market Cap
The collapse of SVB and the subsequent collapses of Signature Bank and First Republic Bank brought attention to the way regulators in the US handle deposit insurance. While the Fed, FDIC, and Treasury have said that SVB and Signature deposit coverage of more than $250,000 is part of the “systemic risk exception,” they have reportedly been looking into increasing the insurance limit.
Following the collapse of SVB in March and Circle’s confirmation that it has about $3.3 billion in bank holdings, the firm’s USD Coin (USDC) briefly pulled away from the US dollar. In June, the stablecoin issuer announced that it plans to launch a native version of USDC on the Arbitrum network.