The digital-asset market is coming off of a turbulent year featuring a number of high-profile blowups. Now, two shutdowns in the banking industry — SVB Financial Group’s Silicon Valley Bank and Silvergate Capital Corp. — have set off a fresh set of stresses.
SVB’s failure triggered a knock-on effect in the crucial market for stablecoins after digital-asset giant Circle Internet Financial Corp., one of the biggest issuers of the widely used tokens known for their perceived safety, revealed it had $3.3 billion of reserves with the bank. The news caused Circle’s token, USD Coin, to slip below its intended 1-for-1 peg with the dollar, sending a shock through the market.
