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

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.

Interpretation of this information:

Conor, the business director of Coinbase, recently tweeted about the stickiness of a large part of USDCs, stating that they would not/could not be redeemed immediately. He points out several examples of large amounts of USDC being essentially lost, locked up, or slow-flowing in various wallets, exchanges, and funds. These include millions of USDC on Blacklist wallet and FTX assets, hundreds of millions in bankruptcy properties with slow flow, and 2.42 million Covid relief funds in India with no flow for over a year. Additionally, centralized enterprises are holding 9-10-digit USDC in their financial wallets.

This message highlights some of the issues and challenges of using USDC, a stablecoin that is supposedly backed 1:1 with US dollars. While USDC has become increasingly popular as a way to facilitate transactions and transfers of funds within the crypto space, it is clear that not all USDC holders are able to make use of it as quickly or easily as they may have hoped.

The examples given in the message highlight the different ways in which USDC can become “sticky”, essentially losing its liquidity and becoming difficult to access or redeem. In some cases, such as the Covid relief fund in India, this may be due to external factors beyond the control of USDC holders. In other cases, such as funds being locked up in bankruptcies or slow-flowing DAOs, it may be due to the limitations or complexities of the crypto ecosystem itself.

Overall, the message suggests that while USDC may offer some benefits as a stablecoin, it is not without its challenges and risks. As such, investors and users of USDC should be aware of the potential for stickiness and take appropriate precautions to ensure that they are able to access their funds when needed.