PANews reported on March 12 that Circle issued an announcement in response to the current situation it is facing. USDC's $3.3 billion cash reserves are still kept by Silicon Valley Bank (SVB). As of Thursday, Circle has tried to transfer these funds to other banking partners. Although these transfers have not been resolved as of the close of business on Friday, it said it remains confident in the FDIC's (Federal Deposit Insurance Corporation) management of SVB's situation and is ready to receive these funds. SVB may not get 100% of the money back, and any money back may take some time because the FDIC issues IOUs (i.e. bankruptcy certificates) and prepaid dividends to deposit holders.

So in this case, Circle will back USDC, as legally required by U.S. stored value money transmission regulations, and use company resources to cover any shortfall, involving outside capital if necessary.

USDC currently has 77% ($32.4 billion) of its reserves held in U.S. Treasury bills (maturity of three months or less) and 23% ($9.7 billion) in cash held by various institutions, of which SVB is just one. U.S. Treasury bills are the most liquid asset in the world and a direct obligation of the U.S. government. These reserves are held in custody by BNY Mellon, with active liquidity and asset management managed by BlackRock.