Gemini says no funds at Signature Bank backing GUSD

Crypto speech Gemini had nary funds astatine Signature Bank, and its Gemini US Dollar (GUSD) stablecoin was not backed by immoderate deposits astatine the failed bank, according to a March 13 authoritative tweet from the company.

— Gemini (@Gemini) March 13, 2023

The speech further clarified that it ha partnered with Signature successful the past, stating: “They [Signature] person been unthinkable partners to Gemini and our manufacture for the amended portion of a decade.” However, each existent reserves are held astatine lone 3 U.S. banks: State Street Bank, Goldman Sachs and Fidelity, Gemini said.

The institution besides stated that it is actively monitoring slope counterparty hazard to guarantee that lawsuit funds and GUSD backing are not impacted.

On March 13, Circle’s US Dollar Coin (USDC) lost its peg successful the secondary marketplace owed to fallout from the Silicon Valley Bank collapse, starring to speculation that GUSD and different stablecoins whitethorn besides suffer their pegs. USDC regained its peg connected March 13.

Gemini emphasized that each GUSD coin is backed by dollar reserves, stating:

As a reminder, Gemini is simply a full-reserve speech and custodian. This means that each lawsuit funds and Gemini dollar reserves are held 1:1 connected Gemini and are disposable for withdrawal astatine immoderate time.

The collapse of Signature was portion of a bid of slope failures that swept the U.S. successful aboriginal March. Silvergate Bank agreed to “voluntarily liquidate” connected March 8, followed by Silicon Valley Bank being unopen down connected March 10.