Tron Founder Justin Sun’s $82M Crypto Swap Shocks Aave Protocol V2
Recently, crypto mogul Justin Sun, also the founder of TRON, has made a monumental move in the cryptocurrency industry. Specifically, he has transferred $82 million USDC (USD Coin) from the Aave Protocol V2 and exchanged it for $82 million DAI. This is a massive move in the crypto industry.
The Aave Protocol V2 is a decentralized finance (DeFi) lending network that allows users to lend and borrow a wide variety of cryptocurrencies and stablecoins, including USDC and DAI. Decentralized exchanges (DEX) and automated market makers (AMM) like Uniswap and Sushiswap may be used to complete the process of exchanging one cryptocurrency for another.
SVB collapse rocks stablecoins
According to reports, the recent financial difficulties experienced by Silicon Valley Bank (SVB) have resulted in heightened scrutiny over the banking links of stablecoin issuers. Given the high reliance that USDC has on a single bank, this has raised some concerns regarding the risk management and collateralization procedures that Circle employs.
The sudden and unexpected closing of Silicon Valley Bank (SVB) on Friday by the California Department of Financial Protection has caused shockwaves to be perceived across the banking sector. The fall of SVB, which had reported assets of $212 billion in the most recent quarter, is the second-largest bank failure in the history of the United States, after only the bankruptcy of Washington Mutual during the financial crisis of 2008.
Bank failure raises concerns
The bank had become a prominent participant in the American financial system, providing services to many high-growth businesses and venture capital firms. Thus the effects of its closing have been felt well beyond its location in Silicon Valley. Due to its bankruptcy, there are now more worries over the security of other banks and the whole financial system.
As the information was made public, members of the Tether (USDT) stablecoin community began to express worry over the current situation, as they feared it would affect the stablecoin.
Paolo Ardoino, the Chief Technical Officer (CTO) of Bitfinex, tweeted that as Tether has no exposure to SVB, it is doubtful that the current circumstance would hurt the stablecoin.
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