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Approximately $12.79 billion, 30% of stablecoin USDC reserves, are reportedly invested in a government money market fund, the Circle Reserve Fund, backed by BlackRock, according to Circle’s most recent attestation report.
Ever since, the percentage of USDC reserves held in the Circle Reserve Fund has increased to around $28.6 billion, or 65%, according to BlackRock’s daily update page.
Crypto analyst John Paul Koning tweeted, “Circle is yielding some of its control over USDC’s reserves to an external manager subject to SEC regulation, which ultimately makes USDC safer.”
He described it as a win for USDC users since they can now receive regular updates from BlackRock with transparency also increased by doing so.
For Circle, BlackRock has been managing a sizable portion of the USDC stablecoin’s reserve assets since November. A customized money market vehicle called The Circle Reserve Vehicle, created by BlackRock invests in US short-dated Treasuries.
Last April, BlackRock backed USDC issuer Circle in a $400M funding round. Since then, Blackrock was set to play the role of the primary asset manager of USDC cash reserves and to help Circle to explore capital market applications for USDC.
BlackRock currently manages over two-thirds of the $44 billion stablecoin’s assets, with 80% of its reserves held in Treasuries. As of November 30, 2022, Circle possessed $43.4 billion in USDC reserves to support the 43.23 billion USDC in circulation, and the fund’s holdings comprised 12 US treasury bills.
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