The USDC weekend of March 2023
On Friday, March 10, 2023, Circle said it had been unable to wire out $3.3 billion of USDC’s reserves, out of around $40 billion, from Silicon Valley Bank before regulators took control of the bank, according to a Federal Reserve research note. Then the weekend began. Hourly prices from data provider DefiLlama trace what followed.
| Time (UTC) | USDC price |
|---|---|
| March 10, 18:01 | $1.0032 |
| March 11, 02:00 | $0.9841 |
| March 11, 07:57 | $0.8767 |
| March 12, 12:00 | $0.9529 |
| March 13, 00:58 | $0.9922 |
| March 13, 18:58 | $1.0010 |
The low came early on Saturday, March 11, more than 12 cents under the peg. By shortly before 01:00 UTC on Monday, March 13, the price was back above 99 cents. The Fed note says Circle paused redemptions on Friday, March 10 and resumed them on Monday, March 13.
The issuer’s account
Circle’s own version appears in its annual report for 2025. It says transfers of more than $3 billion out of the bank “failed to settle” before the FDIC placed it into receivership, and that all of the funds were later made available.
Concerns about Circle’s access to that money caused “a temporary price dislocation on certain secondary trading markets”, the company says, while banks were closed and until a backlog of redemption requests had been cleared.
Holders left anyway. The amount of USDC in circulation fell afterwards, and the Fed note puts the drop in its market capitalization at nearly $10 billion.
Why the market price is the one that moves
Most holders can’t hand a coin back to the issuer. Only direct customers of Circle, “cleared through an application process”, had access to the primary market for USDC, the Fed note says, so everyone else could get out only by selling to another trader.
Direct customers normally close the gap by arbitrage, according to the note, which in practice means buying coins below $1 and redeeming them with the issuer, a trade that works only while redemptions are open.
A depeg can also spread. The same note shows Dai following almost the same path as USDC, down to lows under 90 cents, while USDT traded above $1.
How much drift counts
There is no official line. MiCA, the GENIUS Act and Britain’s 2026 cryptoasset regulations never use the word, and small gaps are routine. Even at the end of the worst week of 2026 for stablecoin supply, DefiLlama priced both USDT and USDC within 0.2 cents of $1 on November 8, 2026.
The law speaks to redemption instead. Article 49 of MiCA obliges an e-money token issuer to redeem “at any time and at par value” without a fee, and once the GENIUS Act takes effect, US issuers will have to publish clear procedures for timely redemption. When a coin slips, the issuer’s own statement on its reserves and on whether redemptions are open is the first document to read.