According to on-chain data, the knowledgeable investors in the cryptocurrency industry, including institutions and major traders, are abandoning Circle's USDC.
Nansen's data shows that smart money wallets hold around $485 million worth of USDC across 1,396 wallets, a decrease from $700 million held in 1,455 wallets a month ago and $1.02 billion held in 1,478 wallets a year ago. Additionally, the percentage of smart money in all stablecoins has decreased to 21%, from near 30% at the beginning of the year and an all-time high of 38% in August 2022. This reluctance of major crypto investors to hold USDC is likely hindering its ability to return to its peg. Nansen reports an 8% increase in the supply of USDC on exchanges compared to a week ago. Currently, USDC is trading at 98 cents, and the Kraken exchange has the closest USDC-USD price at 99.22 cents.
At Binance, the USDC-USDT perpetual futures contracts are trading at 98.72 cents, which is slightly higher than the spot price of 98 cents. This suggests that a few traders are hopeful that the peg will be restored.