TrueUSD attributes Binance Launchpool activities to recent stablecoin price deviation News โธ Binance โธ Stablecoins
TrueUSD attributes Binance Launchpool activities to recent stablecoin price deviation
TrueUSD dispelled concerns about the stablecoin stability, saying redemptions are functional.
2 min read
Updated: Jan. 18, 2024 at 4:14 pm UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
Embattled TrueUSD (TUSD) stablecoin attributed the asset’s recent price deviations from the $1 peg to the “community mining activities associated with Binance Launchpool,” which resultedย in “short-term arbitrage opportunities.”
TUSD’s value has recovered to $0.9904 as of press time after falling to as low as $0.9708 during the past day, according to CryptoSlate’s data.
Addressing price fluctuations
In a Jan. 18 statement on social media platform X, the project’s team characterized the recent volatility as a “normal aspect of market dynamics and liquidity adjustments.” They emphasized that the stablecoin redemption channels remain operational and accessible at a designated website.
“TUSD minting and redemption services are always accessible at tusd.io,” TUSD added.
The project clarified that routine attestations are underway as part of standard operations, debunking any claims suggesting otherwise.
In addition, the team expressed its dedication to expanding its collaboration with Binance and dispelled any concerns about the stablecoin stability.
Why TUSD’s value depegged
On Jan. 16, CryptoSlate reported TUSD’s departure from its $1 peg as holders shifted their assets to competitors like Tether’s USDT.
Observers speculated that the deviation could be tied to Binance’s exclusion of the Justin Sun-linked stablecoin from its launchpool. The launchpool incentivizes investors to lock up certain assets, like FDUSD or BNB, for a predetermined period.
Previously, TUSD was one of the assets allowed for participation in launchpool activities. However, its removal from the list triggered significant selling activity in the market.
On-chain analyst Lookonchain suggested that a whale dumped 2.5 million TUSD on Binance for other stablecoins. However, the investigator also identified two whales, including an address suspected to belong to Justin Sun, buying TUSD in an effort to return it to its peg.
Last year, TUSD saw a dramatic uptick in its circulating supply, which climbed to a peak of $3.5 billion in September from $840 million at the start of the year thanks to the heavy patronage it enjoyed from Binance.
However, the stablecoin supply has dipped by more than 40% in the last two months to under $2 billion after Binance began to promote a new stablecoin, FDUSD.
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Posted In: Binance, Stablecoins
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Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
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In this article
TrueUSD, a USD-backed stablecoin you can exchange and trust.
Tether
$0.99979
Launched in 2014, Tether is a blockchain-enabled platform designed to facilitate the use of fiat currencies in a digital manner.
Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Justin Sun has carved a name for himself as a leading figure in the blockchain sector.