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Investors Turn to Stable Currencies After Cryptofriendly Bank Crisis

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On March 3, it was reported that after the crisis of Silvergate Capital Corp, a cryptofriendly bank, investors were supporting the circulation of stable curren…

Investors Turn to Stable Currencies After Cryptofriendly Bank Crisis

On March 3, it was reported that after the crisis of Silvergate Capital Corp, a cryptofriendly bank, investors were supporting the circulation of stable currency and turning to tokens equivalent to US dollars as cash substitutes. The activities of the two largest stable currencies, the USDT of Tether and the USDC of Circle, rose in India on Friday morning. According to the pricing data of CoinGecko, the 24-hour trading volume of USDT on March 3 was $43.2 billion, compared with $39.9 billion in the previous day, while the trading volume of USDC jumped from $3.4 billion to $4 billion.

After the Silvergate crisis, investors turned to stable currencies, and the market value of USDT increased by nearly $600 million

Interpretation of the news:


The recent crisis faced by Silvergate Capital Corp, a leading cryptofriendly bank, has led investors to adopt a cautious approach towards cryptocurrencies. The fallout from the crisis has resulted in investors supporting the circulation of stable currencies as a means of avoiding any potential market volatility. These stable currencies serve as cash substitutes and are backed by fiat currencies such as the US Dollar.

The two largest stable currencies, USDT from Tether and USDC from Circle, have witnessed a surge in activity, particularly in India. This trend was observed on March 3, where the 24-hour trading volume of USDT rose to $43.2 billion, up from $39.9 billion the previous day. Similarly, the trading volume of USDC jumped from $3.4 billion to $4 billion during the same period. This indicates that investors are increasingly turning to stable currencies as a safe haven investment in times of market uncertainty.

The rise in activity for stable currencies could also be attributed to the current challenges faced by traditional fiat currencies. The Covid-19 pandemic has caused a significant economic upheaval, leading to uncertainty and volatility in global markets. Meanwhile, central banks have been injecting massive amounts of liquidity into the system to spur growth and prevent a recession. However, this has resulted in a rise in inflation fears, undermining the value of fiat currencies. In contrast, stable currencies like USDT and USDC offer investors the stability and reliability of the US Dollar while providing the flexibility of a digital asset.

In conclusion, the crisis faced by Silvergate Capital Corp has highlighted the need for caution and stability in the cryptocurrency market. The rise in trading volume for stable currencies like USDT and USDC is an indication of investors’ preference for safety and predictability in a market that is otherwise characterized by volatility and uncertainty. Stable currencies offer investors an attractive alternative to fiat currencies in the current economic climate, making them a popular choice for those who seek to diversify their portfolios and protect their investments.

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