Swaps volume on web3 wallet provider Metamask hit an all-time high over the weekend as the fall of top crypto-friendly banks Silvergate and Signature sent shockwaves through the sector.
A big part of that was linked to the uncertainty over exactly how those bank closures would play out, Metamask group manager Dan Finlay says on an upcoming episode of The Scoop podcast with Frank Chaparro.
“It’s a lot of just speculative panic. People aren’t sure what they can trust. And everybody seems to want something stable,” he said. People were “making some pretty big moves in response to this situation.”
USDC issuer Circle had announced Friday that it had $3.3 billion in reserves stuck Silicon Valley Bank, which was shuttered by state regulators the same day. On Sunday, regulators said that any deposits would be made whole.
“People were betting, they were freaking out that some of their stablecoins were going to drop. DAI even dropped because most of its backing is on USDC now,” Finlay said.
Metamask made around $1.5 million in swap fees as volume spiked, Finlay said.
“People are onboarding, people are fleeing to crypto in many situations,” he said. “We see that every time there’s one of these systemic shocks, people kind of look at it again and they’re like ‘hey, wait, that’s holding up.'”
So while there might be a systemic risk, it might also be “extremely good” for crypto. “It’s kind of a weird mixed blessing,” Finlay said.