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USDT, USDD, FRAX? Stablecoins Criticized In Light Of Market Uncertainty

November 8, 2022 - Around 2 mins mins to read
USDT, USDD, FRAX – Traders are aggressively transferring their assets to stablecoins as the Alameda/FTX/Binance crisis enters its most hazardous stage. Even USD-pegged assets, however, are not now considered to be “safe haven” assets.
USDT, USDD, FRAX? Stablecoins Criticized In Light Of Market Uncertainty

USDT down, USDC, BUSD up

Unusual activity was observed on the Curve Finance (CRV) and Aave (AAVE) pools by traders and analysts. The largest stablecoin, U.S. Dollar Tether (USDT), is said to have been “shorted” by Alameda Research by switching borrowed USDT for USD Coins (USDC) issued by Circle.

The USDT peg became unbalanced as a result of this monster activity right away, and the asset fell as low as $0.98, the lowest level since the UST crash in May. USDC, on the other hand, “spiked” to $1,007.

This disparity creates risky arbitrage opportunities. The FTX-backed address holding the largest stablecoin, worth over $46 million, was then blocked by Tether Limited, the company that runs USDT. Automated tracking systems recorded this restriction.

The most from this fear was Binance’s stablecoin, BUSD, whose price surged above $1,012 as USDT holders began converting their holdings to BUSD.

Decentralized stablecoins USDD and FRAX are also impacted

USDT, USDD, FRAX? Stablecoins Criticized In Light Of Market Uncertainty

The continued frenzy hurt even stablecoins linked to the euro. According to CoinGecko, the price of Circle’s Eurocoin (EUROC) increased above €1.04 on significant spot markets.

Decentralized stablecoins have so far been the biggest losers in this turmoil. USDD, a stablecoin supported by algorithms and part of the Tron (TRX) ecosystem, momentarily fell below $0.968. Justin Sun instantly added fresh liquidity to a portfolio of assets supporting the USD.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Join us to keep track of news: https://linktr.ee/coincu

Website: coincu.com

Annie

CoinCu News

Alameda

Binance

FRAX

FTX

Stablecoins

USD-pegged assets

USDD

USDT

Author

Annie

Championing positive change through finance, I've dedicated over eight years to sustainability and environmental journalism. My passion lies in uncovering companies that make a real difference in the world and guiding investors towards them. My expertise lies in navigating the world of sustainable investing, analyzing ESG (Environmental, Social, and Governance) criteria, and exploring the exciting field of impact investing. "Invest in a better future," I often say. That's the driving force behind my work at Coincu – to empower readers with knowledge and insights to make investment decisions that create a positive impact.
Airdrop

USDT, USDD, FRAX? Stablecoins Criticized In Light Of Market Uncertainty

USDT, USDD, FRAX – Traders are aggressively transferring their assets to stablecoins as the Alameda/FTX/Binance crisis enters its most hazardous stage. Even USD-pegged assets, however, are not now considered to be “safe haven” assets.
USDT, USDD, FRAX? Stablecoins Criticized In Light Of Market Uncertainty

USDT down, USDC, BUSD up

Unusual activity was observed on the Curve Finance (CRV) and Aave (AAVE) pools by traders and analysts. The largest stablecoin, U.S. Dollar Tether (USDT), is said to have been “shorted” by Alameda Research by switching borrowed USDT for USD Coins (USDC) issued by Circle.

The USDT peg became unbalanced as a result of this monster activity right away, and the asset fell as low as $0.98, the lowest level since the UST crash in May. USDC, on the other hand, “spiked” to $1,007.

This disparity creates risky arbitrage opportunities. The FTX-backed address holding the largest stablecoin, worth over $46 million, was then blocked by Tether Limited, the company that runs USDT. Automated tracking systems recorded this restriction.

The most from this fear was Binance’s stablecoin, BUSD, whose price surged above $1,012 as USDT holders began converting their holdings to BUSD.

Decentralized stablecoins USDD and FRAX are also impacted

USDT, USDD, FRAX? Stablecoins Criticized In Light Of Market Uncertainty

The continued frenzy hurt even stablecoins linked to the euro. According to CoinGecko, the price of Circle’s Eurocoin (EUROC) increased above €1.04 on significant spot markets.

Decentralized stablecoins have so far been the biggest losers in this turmoil. USDD, a stablecoin supported by algorithms and part of the Tron (TRX) ecosystem, momentarily fell below $0.968. Justin Sun instantly added fresh liquidity to a portfolio of assets supporting the USD.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

Join us to keep track of news: https://linktr.ee/coincu

Website: coincu.com

Annie

CoinCu News