Anchorage Digital, a prominent crypto custodian and federally chartered bank, announced its decision to phase out USDC and Agora USD, directing institutional clients towards Global Dollar (USDG). This unexpected move, revealed in a report released on Tuesday, highlights regulatory concerns and reserve asset management issues, sparking a fierce backlash from industry leaders who see this as a destabilizing maneuver in the competitive stablecoin market.
Anchorage’s Strategic Shift
In a bold pivot, Anchorage introduced its “Stablecoin Safety Matrix,” a tool ranking stablecoins based on regulatory oversight and reserve asset management. The report concluded that USDC, the second-largest stablecoin with a $61 billion supply, and two smaller tokens, Agora USD (AUSD) and Usual USD (USD0), no longer align with Anchorage’s security framework. Rachel Anderika, Anchorage’s head of global operations, explained the rationale: “We identified elevated concentration risks associated with their issuer structures—something we believe institutions should carefully evaluate.”
Anchorage’s shift comes amid a burgeoning race to dominate the stablecoin sector, with global banks and crypto firms vying for a foothold. Competition is intensifying as the U.S. Senate just passed the GENIUS Act, a legislative effort aimed at clarifying rules for stablecoins, potentially paving the way for expanded adoption. As stablecoin regulations evolve, the Senate’s focus on market structure could further influence the competitive landscape.
Industry Pushback
The decision was met with swift and fierce opposition. Nick Van Eck, representing Agora USD, accused Anchorage of misrepresenting facts and failing to disclose its stake in Global Dollar. In a forthright social media post, he stated, “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. But attempting to delegitimize AUSD and USDC for ‘security concerns,’ while knowingly publishing false information, is unserious and bizarre.”
Viktor Bunin of Coinbase, which co-launched USDC with Circle, echoed this sentiment, criticizing Anchorage’s decision as a poorly executed hit piece. Jan Van Eck further questioned Anchorage’s risk assessment, suggesting that the safety matrix is laughably flawed: “According to the matrix, Circle’s USDC and AUSD have reserve issues,” he noted, highlighting AUSD’s backing by U.S. treasuries and its regulation by multiple authorities.
The Broader Implications
Circle, the issuer of USDC, defended its compliance record and transparency, emphasizing that USDC is “100% backed by fiat-denominated reserves” and boasts robust primary liquidity through an extensive network of banks. The firm underscored its compliance with both U.S. and European regulatory standards, challenging Anchorage’s assessment.
Support for Circle and Agora came from unexpected quarters. BitGo, a crypto custodian, affirmed its continued support for USDC. Chen Fang, BitGo’s chief revenue officer, stated, “Agora and Circle are long-standing partners of ours, and our customers count on safe, transparent rails for USD settlement.” Joshua Lim from FalconX echoed this support, emphasizing his company’s readiness to support clients using AUSD and USDC.
Looking Ahead
As Anchorage moves forward with its decision, the ripple effects on the stablecoin market remain to be seen. The introduction of the GENIUS Act could reshape the landscape by providing clearer guidelines, but whether this will bolster Anchorage’s stance or further entrench USDC’s position is uncertain. The stablecoin market, already in flux, now faces a critical juncture. For a deeper understanding of potential regulatory shifts, see our coverage of the Senate’s crypto market structure framework.
Will Anchorage’s move set a new precedent, or will the backlash force a reconsideration? As the dust settles, the industry watches closely, raising questions about resilience, transparency, and the future of digital currencies.
Source
This article is based on: Anchorage to Phase Out USDC, Agora USD Citing Risks, Stirring Fierce Backlash
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
