USDC almost lost a good chunk of its reserve backing when SVB went bust. It was only the bailout that saved it. They had $3 billion of their reserves there.
When you use regular Eurodollars you only need to trust your bank and you may have deposit insurance. With USDC you need to trust:
* Circle
* Your exchange
* Your own security
The latter generally isn't a factor with fiat, as transactions are reversible