Famous venture capital firms that bought the altcoin market dip are confident that the Silicon Valley Bank (SVB) crisis can be recouped quickly. Today, several veterans, including Ethereum founder Vitalik Buterin, made additional purchases at the lowest USDC price.
VCs assess bottoming altcoin market
The purchases were specifically focused on USD Coin (USDC). The second-largest stablecoin by market capitalization fell as low as $0.88 due to its deposits stuck in the bankrupt SVB. The decision to suspend USDC-USD transactions from Binance and Coinbase was also effective in the decline. As a result, the market’s largest stablecoin had to lose its stability in the dollar.
While the stablecoin price has lost its stability, causing panic selling, some crypto funds seem confident that there will be a rebound eventually. Some crypto funds, including a wallet allegedly owned by Vitalik Buterin, are trying to hoard USDC at a discounted price. Firms like Jump Trading, Wintermute Trading, Genesis Trading and BlockTower Capital are said to have bought USDC just before the weekend bank holiday, according to on-chain data.
Vitalik Buterin provided 400,000 USDC liquidity
cryptocoin.com As we have mentioned, the founder of Ethereum converted 150 thousand RAI into USDC while USDC fluctuated. On Saturday, Buterin traded 500 ETH for 150,000 RAI, then exchanged 150,000 RAY for 400,359 USDC and 27,179 DAI.
Reflexer’s algorithmic stablecoin had previously received positive reviews from its Ethereum co-founder. Buterin has shared his optimism about RAI in the past. Buterin’s latest move is currently open to interpretation, and it is unclear whether the ETH co-founder supported USDC in its crisis or simply divested its RAI holdings.
Could Silicon Valley Bank further impact the altcoin market?
SVB, one of the largest US banks, was shut down by regulators on Friday (March 10) as it struggled with falling deposits coupled with the Fed’s rate hike, accompanied by a shortage of cash. According to Circle’s transparency report, Silicon Valley Bank was one of six banking partners to back some of its cash reserves the USDC stablecoin.
This reserve represented approximately 7.5% of the total reserves, which included the Circle Reserve Fund portfolio of short-term US treasuries other than cash. Circle has burned $2.34 billion worth of USDC in the last 24 hours, according to blockchain analytics firm Nansen, as nervous investors rushed to reclaim dollars for their falling USDC.
However, Twitter analyst Adam Cochran noted that as USDC reclaimed price stability and FUD subsided, the market is starting to stabilize again. Bitcoin (BTC) regained $20,000 as support amid the Silicon Valley Bank crisis, signaling the overall recovery in the market.
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