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The Stickiness of USDCs: A Cautionary Tale

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It is reported that Conor, the business director of Coinbase, tweeted that it is noteworthy that a large part of USDCs are sticky and will not/cannot be redeeme

The Stickiness of USDCs: A Cautionary Tale

It is reported that Conor, the business director of Coinbase, tweeted that it is noteworthy that a large part of USDCs are sticky and will not/cannot be redeemed immediately. For example, USDC with US $8.1 million is in the blacklist wallet. 10 million USDC is likely to be lost forever, and more than 200 million USD has been locked in FTX assets for many years. Hundreds of millions of funds are locked in the bankruptcy property with slow flow (15 million for Blockfi and 463 million for Voyager). Hundreds of millions of funds are locked in the slow flowing DAO/fund. For example, 2.42 million of the Covid relief fund in India (the fund has no flow in more than 12 months). The 9-10-digit USDC in the financial wallet of centralized enterprises.

Business director of Coinbase: A large part of USDCs will not be redeemed immediately

Analysis based on this information:


The message highlights the stickiness of USDCs, the second-largest stablecoin behind Tether, in the cryptocurrency market. According to Conor, the business director of Coinbase, a significant portion of USDCs cannot be redeemed immediately, creating potential risks for investors and traders. The tweet cites several examples, such as a US$8.1 million USDC in the blacklist wallet, 10 million USDC likely lost forever, and more than 200 million USD locked in FTX assets for many years.

The first implication of this message is the potential loss of funds for investors who have USDC holdings, particularly those that are susceptible to slow flow or bankruptcy. For example, hundreds of millions of funds are locked in the bankruptcy property, with slow flow for Blockfi and Voyager. The message suggests that investors should exercise caution when investing in USDC or other stablecoins as they can potentially face significant losses and lack liquidity when they need it the most.

The second implication is the high risk associated with centralized enterprises that hold large amounts of USDCs in their financial wallets. Conor mentions that there are 9-10-digit USDCs in the financial wallets of central enterprises, which can result in a systemic risk if they suffer major losses or go bankrupt. This potential risk is something traders and investors should be aware of when dealing with USDCs in the cryptocurrency markets.

The third implication is the slow flow of USDC funds in DAO/funds and other Covid relief funds. This situation raises concerns about the efficiency of the financial system and the effectiveness of these funds to deliver aid to people in need. The message suggests that transparency and accountability are necessary to ensure that these funds are correctly utilized and flow efficiently.

In conclusion, the sticky nature of USDCs is a cautionary tale for investors and traders in cryptocurrencies. The message highlights various examples of lost funds, slow flow, and a potential systemic risk for centralized enterprises that hold large amounts of USDCs. Therefore, individuals who invest in cryptocurrencies should exercise care and do their due diligence to minimize the risks associated with USDCs.

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