SV Bank just collapsed, and insured depositors (holding upto $250k) will get their money back immediately while uninsured depositors stand to go through a recovery process and possibly take a long while and lose funds as well.
Silicon Valley bank is one of the banks that USDC/Circle banks with i.e. they hold assets backing USDC in this bank.
As per the latest attestation report of USDC, almost $8.6 Bn is held at “US regulated financial institutions”
Out of their banks, Silvergate is already bust (winding up) and Silicon Valley bank is just shut down by regulators after it collapsed.
We do not know how much is held at SV bank, but assuming they split their 8bn equally, it would be an exposure of around $1bn. This is just an estimate.
Their website reserves composition says that they hold $11.4 BN total as cash in banks, while the rest of the assets backing USDC are short dated US treasuries
Even assuming minimal impact, USDC could be valued at a discount right now, pending clarification from them.
submitted by /u/Set1Less