The Importance of Transparency in Stablecoins

The weekend of March 10th, 2023 was a profound test of how well stable coins hold up under pressure. Circle disclosed all sorts of useful information to users such as each individual treasury bill's CUSIP number and where it banks. Silicon Valley Bank shares were halted at 9.30 AM local time after plunging 62% in pre-market trading. The irony is that neither of Circle's competitors, Tether or Paxos, disclose where they bank. While USDC collapsed on exchanges, the prices of the Tether and Paxos stablecoins held solid.