USDC Being Sold at Heavy Discounts: Details

Since March 10, several USDC owners have switched to alternative stablecoins out of concern for the stablecoin’s soundness in light of the revelation that some of the collateral belonging to Circle is kept at Silicon Valley Bank (SVB).

While such panic selling was going on, one person dumped a sizable amount of 3CRV (DAI/USDC/USDT) into USDT in exchange for paying over 2 million USDC to acquire $0.05 of Tether.

The deal involved the aggregation router from KyberSwap. In particular, a  decentralized exchange (DEX), Kyberswap, collects liquidity from many DEXs. The protocol team stated in an analysis that “since the market was undergoing a volatile period, all routes failed at estimating gas. 

The rate strongly fluctuated & only 0x’s route was successful but with a very poor rate.“

In the meantime, a bot took the chance and made 2,085,256 USDC from that Univ2 pool after verifying the exchange at 0x’s rate in a pop-up. The incident led to the protocol negotiating with the bot’s author, user, and other parties to help with money recovery.

Justin Sun Withdrew $75M

Justin Sun, the founder of Tron, is also said to have moved money to other stablecoins. He reportedly withdrew 82 million USDC via the decentralized finance system Aave v2 and exchanged it for Dai valued roughly $75 million.

According to on-chain data, wallets associated with IOSG Ventures exchanged 118.73 million USDC for 105.67 million USDT and 2,756 ether worth $3.98 million via three addresses. The organization still has roughly USD 45 million in its possession.

The business that created the USDC, Circle, retreated from a proposal to go public in December of last year that was valued at billions of dollars. Recently, it also stated that $3.3 billion, or approximately 23% of its reserves, were held by Silicon Valley Bank. Interestingly, California regulators closed the bank on March 10 after learning about attempts to obtain additional capital.