A significant development has shaken the stablecoin market as Anchorage Digital, a federally chartered crypto bank, announced it will phase out support for Circle's USDC, Agora's AUSD, and Usual's USD0. The firm is directing institutional clients to convert these assets, citing risks identified in its newly released "Stablecoin Safety Matrix." This move has ignited a firestorm of criticism from prominent industry players who question the methodology and motives behind the decision. According to Rachel Anderika, head of global operations at Anchorage, the decision was based on internal criteria for long-term resilience. She stated, “Specifically, we identified elevated concentration risks associated with their issuer structures — something we believe institutions should carefully evaluate.” The firm's matrix gave USDC, the second-largest stablecoin with a $61 billion supply, a low score of 2 out of 5 for regulatory oversight and reserve management, pointing to a lack of “substantive prudential oversight” and a 15% cash holding in its reserves, a vulnerability highlighted during the Silicon Valley Bank collapse in March 2023.

Fierce Industry Backlash and Questions of Motive

The response from the affected parties and the broader crypto community was swift and severe. Nick Van Eck, whose firm Agora issues AUSD, launched a powerful counter-argument, accusing Anchorage of misrepresenting facts and failing to disclose a clear commercial conflict of interest. He pointed out that Anchorage is a founding partner in the consortium behind Global Dollar (USDG), the stablecoin it is promoting as an alternative, and thus stands to benefit financially from this decision. “If Anchorage had just delisted USDC and AUSD to prioritize the stablecoins that they have an economic interest in, I would understand it as a business decision,” he stated in a post on X. “But attempting to delegitimize AUSD and USDC for 'security concerns,' while knowingly publishing false information, is unserious and bizarre.” Support for the delisted tokens came from multiple corners. Crypto custodian BitGo's CRO, Chen Fang, confirmed they are not dropping USDC support, while Joshua Lim of prime broker FalconX affirmed their continued partnership with Agora and Circle. Even Jan Van Eck, CEO of asset manager Van Eck, publicly ridiculed the safety matrix, highlighting that AUSD is backed 100% by treasuries and managed by a firm regulated by numerous authorities.

Circle Defends USDC's Integrity Amidst Market Battle

Circle, the issuer of USDC, robustly defended its stablecoin's standing. In a statement, a spokesperson emphasized the company's “long-standing compliance record” and its position as an industry leader. “USDC is 100% backed by fiat-denominated reserves and has robust primary liquidity through a well-developed network of banks, representing what we view as the highest levels of transparency, safety, and operational resiliency in our industry,” the statement read. This defense is bolstered by external assessments, such as S&P Ratings giving USDC a “strong” rating and crypto-native firm Bluechip assigning it a B+. The controversy unfolds as the stablecoin market becomes an increasingly competitive battleground, with projections from Citi and Standard Chartered suggesting the asset class could grow to trillions of dollars in the coming years. Anchorage's move is seen by many not just as a risk management decision, but as a strategic play to gain market share for its preferred stablecoin, USDG.

Bitcoin's Consolidation and Broader Market Outlook

While the stablecoin space sees drama, the broader crypto market exhibits a tense calm. Bitcoin (BTC) achieved a record monthly close for June, ending above $107,000. However, its modest 2.5% gain was outshined by the euro, which surged nearly 4% against the U.S. dollar. This relative weakness has kept BTC in a tight trading range, recently trading around $106,500, down about 0.6% over 24 hours. On-chain data reveals significant profit-taking, with realized gains hitting $2.4 billion on Monday, suggesting long-term holders are selling into strength. This selling pressure has capped upside potential for now, with other major tokens like Ethereum (ETH), Solana (SOL), and Dogecoin (DOGE) also seeing minor pullbacks. Despite this, some analysts, like Valentin Fournier at BRN, remain constructive, pointing to accelerating institutional accumulation from entities like Strategy and the German savings bank network. Fournier noted, “While short-term momentum has faded, medium-term signals remain bullish... We slightly reduced exposure to protect capital but remain constructive — especially on altcoins with room to catch up.” Traders should remain cautious, as the third quarter is historically Bitcoin's weakest, and lower summer liquidity can lead to exaggerated price swings, reminiscent of the sharp crash seen last year.