Circle’s CEO Jeremy Allaire has attributed USDC’s recent troubles to the US government.
USDC’s value has dropped by roughly $13 billion in the last few months.
Allaire Investors are reducing their risk outside the US and this has an impact on USDC.
Circle’s Allaire Points to US Regulatory Environment
Jeremy Allaire, the CEO of Circle, is pointing to US regulations as the primary culprit in USDC’s recent struggles. Allaire mentioned this during an Interview with Bloomberg Wednesday, April 26th.
According to Allaire, investors are looking to reduce their risk and are avoiding investments in the United States due to the current financial crisis.
Earlier this year, Silvergate Bank shut down its cryptocurrency operations, which had an impact on Circle and other crypto companies. This forced Circle to Move its USDC Reserve Deposits.
In the Bloomberg Television interview, Allaire stated:
“We are seeing a huge amount of concern globally about the US banking system. We are seeing concern about the regulatory environment in the US.”
Circle’s USDC temporarily lost its $1 peg during the banking crisis but regained its value as the market stabilised.
Allaire has urged the US government to regulate the crypto-space, saying:
“The European Union, Hong Kong, Singapore and the Middle East are making progress on crypto rules, while the US is behind right now.”
USDC Lags Behind Tether’s USDT
Circle’s recent troubles have seen its stablecoin fall behind its nearest competitor, Tether’s USDT. Following the banking crisis, USDC’s market cap dipped by more than $13 billion, and it currently has a market cap of around $30 billion.
This has allowed Tether’s USDT to strengthen its position as the leading stablecoin in the market. USDT’s market cap is $81 billion; this is nearly triple the value of USDC.
Circle’s collapsed financial system also held about $3.3 billion. The company has stated that it will cover any financial shortfalls caused by the recent banking crises.