Can Circle [USDC] Turn Things Around With New Plan? All You Need to Know

Circle had its most difficult week of the year after USD Coin [USDC] lost its dollar peg. Although it has subsequently recovered, the stablecoin issuer has just issued a new update addressing its USDC activities.

Circle redeemed 2.9 billion USDC and coined 700 million USDC on March 14, according to the statement. The activities were part of the organization’s action plan to aid peg recovery. Circle also stated that it had secured additional transaction banking partners. The company’s purpose is to enable transactions that are not restricted by traditional banking hours.

Circle also revealed that its transaction banking partners have insufficient money to facilitate redemption and minting. It also reported that a portion of their reserve was stored in cash at BNY Mellon. As a result, at the time of publication, it had on-ramps for individuals wishing to shift their cash into the crypto section.

Circle’s move emphasized attempts to circumvent authorities’ efforts to restrict banks from dealing with cryptocurrency startups. It also happened only days after several banks failed, putting additional strain on the currency system. As a result, more individuals were losing faith in the fiat system, which was a major component in the surge during the last three days.

The aforementioned arguments, as well as the fact that USDC has passed its test, have restored some faith in the stablecoin. USDC supply in smart contracts just returned to a four-month high.

However, what about market demand? According to address characteristics, USDC receiving addresses were slightly higher than sending ones. Another significant finding is that both measures have declined significantly after 11 March, as users have shifted to other stablecoins.

However, addresses began to level out at the time of publication, indicating that USDC trade activity is rebounding. The stablecoin’s exchange flows demonstrate this. Both exchange inflows and outflows have increased in the last three days after plummeting due to the depeg.

Exchange outflows continue to outnumber inflows, indicating that the USDC has yet to regain complete confidence. This could also be attributed to the current crypto rise, which resulted in investors purchasing crypto in exchange for stablecoins.