The answer to the above question is no. Although knowing nothing is 100% certain, the probability of USDC becoming the second UST is very very low, because the USDC escrow mechanism is completely different from the UST. Let’s find out together. —————————- ***USDC depeg 12%*** On the 7th day, make sure you keep an eye on the market I see a very special event happening. That is USDC trading as low as 0.88 – equivalent to a 12% depeg from its $1 mark. Currently, USDC is close to peg recovery, back to trading at $0.98, after the news that the FED accepted to “save” SIVB. Similarly, algorithmic stablecoins partially backed by USDC and associated project tokens have rebounded relatively strongly – $MKT, $FXS. ***Reason for Depeg*** USDC’s guarantee mechanism is 1:1 backed by fiat. So that means as long as the backed amount is “fine”, USDC is always $1. However, the bankruptcy of SIVB (Silicon Valley Bank) in just 1 day brought a shock to USDC. Circle – the parent company of USDC has a deposit of $3.3B – equivalent to 8.2% of USDC’s backed supply. At that point, if Circle is unable to recover this $3.3B, it means that USDC is running short of at least $3.3B, meaning that the entire USDC in circulation is backed by only 91.75% of fiat. corresponding. This gives USDC a maximum value at $0.91. Adding to the factors from the market, people panic sold, pushing the maximum USDC down to $0.88. ***Assessment of the Situation*** In my opinion, one way or another, the Crypto market will benefit from the collapse of traditional financial institutions. Everyone remember, $BTC was born after the public lost confidence in banks after the 2008 economic crisis, and since then, the Crypto market has existed and grown tremendously, becoming an asset arm that parallels the traditional markets. We will still be able to have FUD *(for sure)*, there are very bad macro news that negatively affect the market. So every time something like this happens, remember why this market was born.
Source: Collector
