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USDC market cap drops nearly in half due to U.S. regulatory crackdowns and banking Crisis
USDC depegged in March earlier this year as a result of the US banking crisis. Silicon Valley Bank, one of the three crypto-friendly banks that were shut down by regulators, was where Circle's $3.3 billion in USDC reserves were held. At the time, Circle informed its clients that they had the financial resources to fill the shortfall, but the market responded rapidly to the news, and the value of USDC depreciated against the US dollar.
USDC once had a market cap of $56 billion at its peak and was sitting right behind Tether-issued USDT. However, with the advent of the banking crisis and its depeg, USDC’s market cap has been cut nearly in half and is currently sitting at $30.7 billion.
Circle CEO warns lack of crypto regulation may force US firms abroad
The lack of regulatory clarity, according to a warning from Coinbase, may lead cryptocurrency businesses to explore business possibilities abroad. With the recent passing of the Markets in Crypto-Assets Act, known as MiCA by the European Parliament, and the push for adoption by Hong Kong, Allaire believes the US will be left behind.
Allaire has called for Congress to step up at this critical moment in the US. It remains to be seen whether the US will provide the regulatory clarity that crypto companies are looking for or whether they will have to look overseas to grow their businesses.