Top Depositors at Failed SVB Include Circle, Sequoia Capital

According to reports, stablecoin issuer Circle and venture capital firm Sequoia Capital were among the top 10 depositors at the crypto-friendly Silicon Valley Bank (SVB) in March before its collapse.

Bloomberg reported on June 23 that the Federal Deposit Insurance Corporation (FDIC) provided documents indicating that Circle, Sequoia, and others were insured for billions of dollars in deposits.

Following the failure of SVB, the Federal Reserve announced that it would collaborate with the FDIC to compensate both insured and uninsured depositors; in most cases, the FDIC insures up to $250,000 per depositor.

According to reports, Circle had approximately $3.3 billion in deposits, while Sequoia had roughly $1 billion.

Other significant depositors included Silicon Valley Bank, SVB Financial Group, biotechnology research firm Altos Labs, and Kanzhun Limited, a China-based corporation responsible for a powerful online recruitment platform.

The failure of SVB and the subsequent failures of Signature Bank and First Republic Bank have highlighted how U.S. regulators handle deposit insurance.

Even though the Fed, FDIC, and Treasury Department have stated that covering SVB and Signature deposits over $250,000 is a “systemic risk exception,” they have reportedly considered increasing the insurance cap.

Following the March failure of SVB and Circle’s confirmation that it had approximately $3.3 billion in exposure to the failed bank, the company’s USD Coin briefly decoupled from the U.S. currency.

In June, the stablecoin issuer intended to release a native variant of USDC on the Arbitrum network.