Latest news with #Circle
Yahoo
5 hours ago
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Anchorage to Phase Out USDC, Agora USD Citing Risks, Stirring Fierce Backlash
Anchorage Digital, a crypto custodian and federally chartered bank, said it will start phasing out and direct institutional clients to convert USDC USDC and other stablecoins into rival token Global Dollar (USDG) in a sweeping move that drew criticism from industry players. The firm released a "Stablecoin Safety Matrix" that ranks stablecoins based on regulatory oversight and reserve asset management on Tuesday. Circle-issued USDC, which is the second-largest stablecoin with a $61 billion supply and is popular among institutions, was deemed no longer suitable under Anchorage's security framework. Two other, smaller tokens, Agora USD (AUSD) and Usual USD (USD0), were also slated for removal. Stablecoins are cryptocurrencies with their prices tied to an external asset, predominantly to the U.S. dollar. "Following our Stablecoin Safety Matrix, USDC, AUSD, and USD0 no longer satisfy Anchorage Digital's internal criteria for long-term resilience," Rachel Anderika, head of global operations at Anchorage, said in a statement justifying the decision. 'Specifically, we identified elevated concentration risks associated with their issuer structures — something we believe institutions should carefully evaluate." "Anchorage Digital is focused on supporting stablecoins that demonstrate strong transparency, independence, security, and alignment with future regulatory expectations," she added. The move came at a time when competition in the stablecoin market is heating up with global banks, payments firms and crypto companies jockeying for position in the rapidly-growing sector. The U.S. Senate recently passed the GENIUS Act that aims to enact clear rules for the asset class and issuers, which could open the gates for broader adoption. On Friday, White House crypto czar David Sacks suggested that the bill may become law as soon as next month, pending passage in the House of Representatives. Reports by Citi and Standard Chartered reports projected the asset class to grow from the current $250 billion to trillions through the next few years. Circle (CRCL), the company behind the USDC token, recently went public and skyrocketed in valuation. Anchorage gave USDC a score of 2 out of 5 for regulatory oversight and reserve management. The report said there was "no substantive prudential oversight" and that Circle had a large — about 15% — amount of its reserves held in cash at banks. Notably, USDC depegged temporarily in March 2023 when partner bank Silicon Valley Bank went under. Tether's USDT, the world's largest stablecoin, had a higher rating with Anchorage pointing to it being regulated in El Salvador. S&P Ratings rated USDC "strong," its second-best rating in its stablecoin stability assessment. Bluechip, a crypto-native stablecoin rating firm, gave USDC a B+ rating in its economic safety rating. Anchorage's decision met with fierce pushback. Nick Van Eck, whose firm Agora issues AUSD, accused Anchorage of misrepresenting facts about his stablecoin and failing to disclose its commercial interest in Global Dollar. USDG is issued by Paxos and is backed by a consortium of firms that share the income from the reserve assets backing the token. Anchorage is a founding partner in that consortium. "If Anchorage had just delisted USDC and AUSD to prioritize the stablecoins that they have an economic interest in, I would understand it as a business decision," he said in an X post. "But attempting to delegitimize AUSD and USDC for 'security concerns,' while knowingly publishing false information, is unserious and bizarre." "Never seen such an obvious hit piece be so poorly executed," said Viktor Bunin, protocol specialist at digital asset exchange Coinbase. Coinbase jointly launched USDC with Circle in 2018, and shared revenue from the reserve assets backing the token. Jan Van Eck, father of Nick Van Eck and CEO of asset manager Van Eck, which manages AUSD's backing assets, also questioned the risk assessment. "If you need a laugh, check out this 'safety' matrix before Anchorage pulls it down. According to the matrix, Circle's USDC (world's second largest stablecoin) and AUSD (backed 100% by treasuries) have reserve issues," he posted on X. "Oh, and by the way, AUSD's reserve manager is regulated by umpteen different regulators." Circle, in a statement sent to CoinDesk, defended the firm's "long-standing compliance record" and "strong reputation as an industry leader." "We comply with the prevailing U.S. regulatory standards that apply to leading fintech and payments firms, and we were the first stablecoin issuer to achieve full compliance with the European Union's landmark crypto law," a Circle spokesperson said. "USDC is 100% backed by fiat-denominated reserves and has robust primary liquidity through a well-developed network of banks, representing what we view as the highest levels of transparency, safety, and operational resiliency in our industry." Support came for Circle and Agora outside of the two stablecoins' camp. "For the record, BitGo is not dropping USDC support," said Chen Fang, chief revenue officer at crypto custodian BitGo. "Agora and Circle are long-standing partners of ours, and our customers count on safe, transparent rails for USD settlement," said Joshua Lim, co-head of markets at crypto prime broker FalconX, adding that his company "is ready to support clients using AUSD and USDC." Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 hours ago
- Business
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Market Wrap: Crypto Markets Shrug Off New Trump Tariff Threat as July Deadline Looms
The crypto markets experienced a relatively calm day on Friday in spite of a renewal of the threat of tariffs. Bitcoin (BTC) is down 0.7% in the last 24 hours, now trading for $106,700, according to CoinDesk market data. The orange coin's performance was broadly in line with the CoinDesk 20's — an index of the top 20 cryptocurrencies by market capitalization, except for stablecoins, memecoins, and exchange coins — which fell 0.7% in the same period of time. Sui (SUI) was the index's token that experienced the biggest price change either way, and it only rose 3.3%. Crypto stocks saw more significant moves, with Coinbase (COIN) and Circle (CRCL) losing 6% and 16% respectively. The stablecoin issuer's stock is down 40% since it topped at almost $300 on Monday. Bitcoin miners remained relatively flat on the day, including Core Scientific (CORZ), which rose more than 30% on Thursday off a report that AI Hyperscaler CoreWeave was looking into acquiring the company, although Hut 8 (HUT) fell 6.5%. The mild price action contrasted with the prospect of the White House's tariff strategy kicking into high gear again. U.S. President Donald Trump announced that his administration would be terminating all trade discussions with Canada in light of the Digital Services Tax the country aims to impose on U.S. tech firms. 'We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven-day period,' Trump posted. The pause on reciprocal tariffs is also slated to end on July 9, but neither traditional markets nor crypto seem particularly concerned, Coinbase analysts noted in a research report. '[Markets] have largely disregarded the potential economic risks stemming from this situation… partly because this hasn't necessarily been reflected in the economic data,' the analysts wrote. The complacency around tariffs will likely continue, they said, because they are unlikely to be as inflationary as previously expected. Sign in to access your portfolio
Yahoo
8 hours ago
- Business
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Market Cap of Euro Stablecoins Surges to Nearly $500M as EUR/USD Rivals Bitcoin's H1 Gains
The Euro-U.S. dollar exchange (EUR/USD), the world's most liquid foreign exchange pair, has surged 12.88% in the first half, outperforming Nasdaq and S&P 500 and nearly rivaling bitcoin BTC 14.8% rise, according to data source TradingView. The strength of the euro has increased the appeal of stablecoins with values pegged to the euro. The cumulative market cap of 21 euro-pegged stablecoins tracked by data source Coingecko has increased 44% from $310 million to $480 million. Leading the growth is the U.S.-listed Circle's EURC stablecoin, whose market cap has increased by 138% to $200.36 million. "One of my best trades this year was to move my entire stablecoin stack from USDC/USDT into a Euro-denominated stablecoin like EURC. Up 13% in dollar value in less than 5 months," Legendary, the pseudonymous host of The Modern Market Show, announced on X. While the demand for euro-pegged stablecoins has increased, their combined market cap remains less than 1% of that of dollar-pegged stablecoins, which boast a cumulative market value of $254.88 billion. EUR/USD has risen from 1.0354 to nearly 1.17, hitting the highest since September 2021. The upswing is characterized by a breakdown in the correlation between the exchange rate and the differential between the Fed and ECB interest rates, as well as a broad-based shift away from the US dollar. The 90-day correlation coefficient between EUR/USD and bitcoin has recently jumped to 0.62, the highest since February 2024, indicating a moderate positive correlation between the two. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
8 hours ago
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Stablecoins Are the ‘Quiet Winners' of Polymarket's Surge: Coinbase Research
As Polymarket seeks a $1 billion valuation in a Founders Fund-led round, the 'quiet winners' may be the stablecoins underpinning its settlement infrastructure, Coinbase analysts wrote in a Friday research report. All of the platform's trades settle in Circle's USDC on Polygon, creating measurable demand for the dollar-pegged token. And while lending protocols lock capital in pools, prediction markets like Polymarket cycle funds at a high velocity — settling, redeploying and transferring balances continuously, the analysts said. The platform has processed more than $14 billion in lifetime trading volume. In May alone, it cleared $1 billion, with daily active traders averaging between 20,000 and 30,000. Meanwhile, in the immediate aftermath of U.S. President Donald Trump's re-election in November 2024, monthly volume soared to $2.5 billion, sparking corresponding spikes in USDC transfers and bridge activity. Such flows demonstrate how stablecoins now power real-time market infrastructure. 'Momentum is likely to accelerate further with a new content partnership with X, positioning prediction markets as viral social content rather than purely financial tools,' the report said. Sign in to access your portfolio
Yahoo
8 hours ago
- Business
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CoinDesk Weekly Recap: Stablecoins Dominate the Cycle
With the near-passage of the GENIUS Act and a host of companies announcing stablecoin initiatives, stablecoin-related assets have been on a tear. Circle, issuer of USDC, has seen its stock rise about 500% since its debut on June 5. This week, the company was valued at a staggering $77 billion, which is well above the total market cap of USDC itself (about $62 billion). Bullish signals for stablecoins were all around: CRCL is now the most popular foreign stock in South Korea. The leading stablecoin issuer, Tether, has so much spare cash it can afford to have a determinative stake in Juventus, an Italian soccer which actually makes more money from USDC than Circle, has seen its stock rise to its highest level in four years. Even Euro-backed stablecoins, long a forgotten cousin of USD coins, are surging. Combined, they're up 44% on the year, led by Circle's EURC. Stablecoins are the "quiet winners" from prediction markets like Polymarket. And so on. Traditional payment giants, like Mastercard and Visa, have been responding to stablecoin mania by making a flood of announcements of their own. Mastercard announced new tie-ups with Moonpay, Chainlink and Kraken this week. Amid all the stablecoin news, we still had space for plenty of other topics. SEI surged as well (albeit on stablecoin news). The Federal Reserve officially said crypto no longer carried 'reputational risks' for banks, leaving them to provide all the financial services they want for crypto companies. World Liberty Financial, the Trump family vehicle, reversed a promise to make its token non-transferable. In the summer months, sometimes it can feel like nothing much is happening. Not this year; crypto doesn't wait for anyone.
