• Circle CEO Jeremy Allaire attributes the drastic drop in USDC’s market capitalization to the United States regulators’ intensified scrutiny of cryptocurrencies.
• The U.S. banking crisis in March caused USDC to depeg from the U.S. dollar, leading to a plummeting market cap of $30.7 billion.
• Coinbase has cautioned that without regulatory clarity, cryptocurrency companies may look for opportunities abroad, urging Congress to take action at this crucial moment.
Market Cap Falls
Circle CEO Jeremy Allaire attributes the drastic drop in USDC’s market capitalization to the United States regulators’ intensified scrutiny of cryptocurrencies amid a turbulent financial landscape. In recent news, Circle CEO Jeremy Allaire has attributed the plummeting market capitalization of its stablecoin, USDC, to the United States regulators’ stringent crackdown on cryptocurrencies.
U.S Banking Crisis
The depegging of USDC in March was a direct consequence of the U.S. banking crisis which froze Circle’s $3.3 billion reserves at Silicon Valley Bank – one of three crypto-friendly banks shuttered by regulators causing USDC market cap to plummet from $56 billion to $30.7 billion .
Coinbase has also cautioned that lack of regulatory clarity may compel cryptocurrency companies to seek opportunities abroad as Europe passed Markets in Crypto-Assets Act (MiCA) and Hong Kong pushing for adoption could push U.S further behind .
The SEC has issued warnings of potential regulatory action against numerous crypto platforms and exchanges during an oversight hearing on digital assets with Gary Gensler leading it faced significant opposition from lawmakers and advocates alike .
Congressional Action Urged
With European Parliament and Hong Kong pushing for adoption Congress must take decisive action now as warned by Coinbase , urged by Jeremy Allaire and supported by SEC head Gary Gensler if they wish not fall behind other nations in digital assets regulation .