• Circle has released its reserve report for December 2022, highlighting overcollateralized asset holdings currently backing 44.5 billion USDC tokens in circulation.
• The reserve report, reviewed by Grant Thornton accountancy group, breaks down the current make-up of the stablecoin issuer’s reserve vault.
• The equity interests in the fund are wholly owned by Circle and include 14 different U.S. treasury bills valued at over $23.5 billion.
Circle, a stablecoin issuer, has released an accountant-verified report of its treasury reserve holdings backing more than $44.5 billion worth of tokens currently in circulation. The report, which was reviewed by Grant Thornton accountancy group, breaks down the current make-up of the stablecoin issuer’s reserve vault.
According to Circle, 44,553,543,212 USDC is currently backed by $44,693,963,701 U.S. dollars held in custody accounts. A significant portion of the latter amount is invested in various U.S. treasury bonds. As per Circle’s vice president of accounting Timothy Singh, the fair value of assets in the USDC reserve is the total balance of U.S. dollar-denominated assets, including a mix of cash and treasury bonds.
Circle’s reserve fund is registered as a government money market fund. The equity interests in the fund are wholly owned by Circle and include 14 different U.S. treasury bills valued at over $23.5 billion. The fund also holds $48.9 million in cash, while a further $33 million is due to the fund, offset by “timing and settlement differences.” Furthermore, the fund’s assets are divided into two major classes – U.S. dollars and U.S. treasury bonds – with the former accounting for $31.2 billion and the latter for $13.5 billion.
The report also highlights the overcollateralized nature of the reserve fund, as it currently has an excess of $2.2 billion, meaning that there is more than enough collateral to back all USDC tokens in circulation. This excess is due to the fact that Circle issues USDC tokens only after acquiring the underlying U.S. dollar-denominated assets.
Overall, the report provides an interesting insight into the reserve holdings of the stablecoin issuer, helping to reassure users of the company’s solvency and the soundness of its financial management. It also serves as a testament to the robustness of the USDC stablecoin, which is backed by a well-diversified mix of U.S. dollar-denominated assets.