SVB Debacle: Circle, Avalanche, Coinbase, Other Crypto Giants Exposed to SVB

March 13, 2023

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SVB Debacle: Circle, Avalanche, Coinbase, Other Crypto Giants Exposed to SVB

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Following the meltdown of Silicon Valley Bank, crypto firms have been disclosing whether or not they have notable exposure to the bank, however, Coinbase, Circle and other crypto giants all have notable exposure to the collapsed SVB.

One of the crypto firms that disclosed its exposure is the bankrupt crypto lender BlockFi, according to a Friday filing, BlockFi has $227 million in funds at SVB, adding that the funds are not Federal Deposit Insurance Commission insured because they’re in a money market mutual the fund which itself may constitute a violation of bankruptcy law. BlockFi filed for creditors’ protection following the collapse of FTX exchange.

Per new bankruptcy filing, BlockFi has $227m in Silicon Valley Bank. The bankruptcy trustee warned them on Mon that bc those funds are in a money market mutual fund, they’re not FDIC secured — which could be a prblm w/ keeping in compliance of bankruptcy law pic.twitter.com/hnpo8anrrS
— Lauren Hirsch (@LaurenSHirsch) March 10, 2023

Also, Ripple CEO Brad Garlinghouse on Sunday said the company “had some exposure to SVB—it was a banking partner, and had some of our cash balance,” adding that Ripple expects that day-to-day running of the business continues and the company remains in a financially strong position.

Setting the record straight on SVB Qs:

Ripple had some exposure to SVB – it was a banking partner, and held some of our cash balance. Fortunately, we expect NO disruption to our day-to-day business, and already held a majority of our USD w/ a broader network of bank partners.
— Brad Garlinghouse (@bgarlinghouse) March 12, 2023

Furthermore, the issuer of the second largest stablecoin USDC last Friday said SVB is one of the banking partners Circle uses for managing approximately 25% portion of USDC reserves, furthering that the firm will continue to operate normally while waiting for clarity on how the receiver will impact its depositors, since this information was disclosed, there has been a surge in the rate of withdrawal of holdings in USDC, leading to fear, uncertainty and distress surrounding the stablecoin.

Silicon Valley Bank is one of six banking partners Circle uses for managing the ~25% portion of USDC reserves held in cash. While we await clarity on how the FDIC receivership of SVB will impact its depositors, Circle & USDC continue to operate normally.https://t.co/NU82jnajjY
— Circle (@circle) March 10, 2023

Crypto-focused firm Pantera also has an undisclosed amount held in SVB.

Avalanche Foundation, a supporter of Avalanche blockchain, is as well exposed to the collapsed SVB, revealing on Friday that it has roughly $1.6 million held in the bank.

In light of recent news, we would like to confirm that the Avalanche Foundation has no exposure to Silvergate and a little over $1.6mm of exposure to Silicon Valley Bank. Avalanche Foundation is saddened by the news about SI and SIVB, and hope that all depositors are made whole.
— Avalanche ???? (@avax) March 10, 2023

Another crypto firm with notable exposure is Yuga Labs, the maker of the Bored Ape Yacht Club NFT collection said it had “Super Limited” exposure to the bank.

BREAKING NEWS » @yugalabs Co-Founder @CryptoGarga Said that Yuga Labs Had “Super Limited” Financial Exposure To The @SVB_Financial Fallout. pic.twitter.com/RXxBkyPOwX
— The Bored Ape Gazette???? (@BoredApeGazette) March 10, 2023

Proof, the company behind the leading NFT collections Moonbirds, on Friday confirmed its exposure to SVB, though it didn’t disclose the amount.

“Proof holds cash at SVB, however… We’ve thankfully diversified our assets across ETH, stablecoins, as well as fiat,” the company Tweeted Friday.

2/5: In the spirit of transparency, here’s everything we know about the situation with SVB:

Proof holds cash at SVB, however…
We’ve thankfully diversified our assets across ETH, stablecoins, as well as fiat—so financially and operationally, we’re going to be OK.
— PROOF (????,????) (@proof_xyz) March 10, 2023

Nova Labs co-founder also confirmed exposure to SVB.

“Nova Labs has some $ stuck in SVB, but the vast majority is in other institutions,” Nova Labs CEO and Helium co-founder Amir Haleem said.

incredible that (3,3) really was the right strategy@novalabs_ has some $ stuck in SVB, but the vast majority is in other institutions

I feel terrible for all the other founders and startups who were not so fortunate. hoping for a speedy resolution ????????
— amir ????️ (@amirhaleem) March 11, 2023

Also, Armstrong Coinbase said it has $240 million held in SVB, and as stated by FDIC, Coinbase expects to recover those funds fully.

All client cash at banks continues to be protected by FDIC pass-through insurance. Due to FDIC's hold on Signature’s transactions, we’re currently facilitating all client cash transactions with other banking partners.
— Coinbase ????️ (@coinbase) March 12, 2023

Paxos, the issuer of Binance USD stablecoin just ran into trouble with the US regulators said it had no exposure to the collapsed SVB, Crypto.com also has no exposure, the company’s CEO confirmed in a tweet.

Statement from Paxos: Paxos has no relationship with Silicon Valley Bank. For further certainty, Paxos stablecoins have zero exposure to Silicon Valley Bank failure.
— Paxos (@Paxos) March 10, 2023

https://t.co/pFc4Pz8PQj has $0 exposure to Silvergate and SVB.
— Kris | Crypto.com (@kris) March 11, 2023

Kraken, Binance, Dapper Labs, Tether, Polygon, and Solana, amongst others, are among the crypto firms with no exposure to SVB.

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