{"id":75795,"date":"2023-03-18T13:54:24","date_gmt":"2023-03-18T11:54:24","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=75795"},"modified":"2025-09-10T13:39:11","modified_gmt":"2025-09-10T10:39:11","slug":"moodys-usdc-depeg-could-erode-trust-in-stablecoins","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/moodys-usdc-depeg-could-erode-trust-in-stablecoins\/","title":{"rendered":"Moody\u2019s: USDC depeg could erode trust in stablecoins"},"content":{"rendered":"<p>Analysts at Moody\u2019s <a href=\"https:\/\/www.moodys.com\/research\/doc--PBC_1361374?cid=A80661A9C4017336\">believe<\/a> that the recent depegging of USD Coin (USDC) from the US dollar could hinder the development of stablecoins and lead to tighter regulation.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cSo far, fiat-backed stablecoins have demonstrated remarkable resilience, emerging unscathed from previous scandals, such as <a href=\"https:\/\/forklog.com\/en\/news\/greed-and-recklessness-why-the-ftx-collapse-is-being-likened-to-the-2008-crisis\">the collapse of FTX<\/a>,\u201d Moody\u2019s said.<\/p>\n<\/blockquote>\n<p>Analysts also noted the significant growth in the market capitalisation of fiat-backed stablecoins in recent years.<\/p>\n<p>On March 11, USDC <a href=\"https:\/\/forklog.com\/en\/news\/usdc-loses-peg-to-the-dollar-amid-svb-collapse\">lost its peg to the US dollar<\/a> after its co-emitter Circle announced it held $3.3 billion in reserves in <a href=\"https:\/\/forklog.com\/en\/news\/venture-capital-investors-distance-themselves-from-silicon-valley-bank-amid-liquidity-concerns\">closed by authorities<\/a> Silicon Valley Bank (SVB).<\/p>\n<p>In the company <a href=\"https:\/\/forklog.com\/en\/news\/circle-promises-to-cover-any-shortfall-in-backing-for-usdc\">to cover &#8216;any shortfall&#8217;<\/a> of the collateral backing the stablecoin was promised. However USDC fully regained parity with the US dollar only after American regulators announced the <a href=\"https:\/\/forklog.com\/en\/news\/us-rescue-saves-svb-and-signature-bank-depositors-stablecoins-narrow-the-depegging\">rescue of SVB depositors<\/a>.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cOtherwise, USDC could have suffered a collapse and would have been forced to liquidate its assets. Given current market volatility, such a scenario could have triggered more collapses in the asset-holding banks of Circle, which could lead to the depegging of other stablecoins,\u201d Moody\u2019s said.<\/p>\n<\/blockquote>\n<p>The agency noted that the crypto industry could have \u201camplified the shock caused by the traditional economy.\u201d<\/p>\n<p>In the five days after the depegging, Circle burned about 6.2 billion USDC and issued about 1.66 billion USDC, <a href=\"https:\/\/forklog.com\/en\/news\/circle-trims-usdc-supply-by-4-5-billion-coins-in-five-days\">reducing the asset&#8217;s supply<\/a> by 4.5 billion USDC.<\/p>\n<p>On March 16, Tether\u2019s stablecoin USDT <a href=\"https:\/\/forklog.com\/en\/news\/usdt-doubles-usdc-in-market-capitalization\">surpassed USDC<\/a> in market capitalization by more than twofold.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Analysts at Moody\u2019s believe that the recent depegging of USD Coin (USDC) from the US dollar could hamper the development of stablecoins and lead to tighter regulation.<\/p>\n","protected":false},"author":1,"featured_media":75796,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1825,807,910],"class_list":["post-75795","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-moodys","tag-stablecoins","tag-usdc"],"aioseo_notices":[],"amp_enabled":true,"views":"17","promo_type":"1","layout_type":"1","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/75795","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/comments?post=75795"}],"version-history":[{"count":1,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/75795\/revisions"}],"predecessor-version":[{"id":75797,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/75795\/revisions\/75797"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media\/75796"}],"wp:attachment":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media?parent=75795"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/categories?post=75795"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/tags?post=75795"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}