Crypto users turned to DEXs, loaded up on USDC after Silicon Valley Bank crash

With the collapse of the Silicon Valley Bank (SVB), investors filled their bags with USD Coins (USDC), draining funds from centralized exchanges (CEX) to decentralized exchanges (DEX).

Chainalysis, a blockchain analytics firm, explained in a March 16 blog that outflows from centralized exchanges often spike during periods of market turmoil. directorusers may be worried about losing access to their funds when the exchange goes down.

Funds transferred from CEX to DEX after SVB’s bankruptcy. Source: Chainalysis.

According to Chainalysis data, hourly outflows from CEX to DEX surpassed $300 million on March 11, shortly after SVB was shut down by California regulators.

A similar phenomenon was seen when the virtual currency exchange FTX went bankrupt last year, and there was a fear that the infection would spread to other virtual currency companies.

However, data from blockchain analytics platform Token Terminal suggests that the surge in daily trading volume of large DEXs is short-lived in both cases.

Daily trading volume of large DEXs from September to March. sauce: token terminal.

USDC was identified as one of the top assets migrating to DEXs. Chainalysis said it is not surprising given that USDC was depegged after stablecoin issuer Circle announced that SVB had $3.3 billion in reserves left.

Related: Circle clears ‘substantially all’ of USDC’s minting and redemption backlog

What’s surprising is the surge in USDC acquisitions on large DEXs such as Curve3pool and Uniswap, which he said “had a huge spike in user acquisition for some assets, but it was only USDC.” I’m here.

Token Acquisition on Uniswap from March 7th to March 14th. Source: Chainalysis.

Chainalysis theorizes that this was due to trust in stablecoins, with some cryptocurrency users loading up on USDC when it was relatively cheap and betting on getting their peg back. We did it on March 13th. according to Go to Coin Market Cap.

A brief depeg of USDC from March 11th to March 13th. Source: CoinMarketCap.