TUSD’s supply hits low as stablecoin struggles to maintain $1 peg News ▸ Binance ▸ Stablecoins
TUSD’s supply hits low as stablecoin struggles to maintain $1 peg
TUSD instability prompts massive sell-off on various trading platforms.
2 min read
Updated: Jan. 16, 2024 at 11:36 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
TrueUSD (TUSD) stablecoin experienced wild volatility the past day as it fell below the $1 peg amid its declining supply.
Data from CryptoSlate shows that the stablecoin fell to as low as $0.984 during the reporting period and has yet to regain its peg as of press time. Chainlink’s TUSD data also confirms this downtrend, with the Justin Sun-linked stablecoin exchanging hands for $0.98535493.
Trading activity analyzed on various platforms shows that the stablecoin holders have been dumping their assets.
For context, Binance data shows that about 60% of the cash flow around TUSD has gone to the asset’s sales. TUSD saw sell orders exceeding $450 million against around $296 million in buy orders. This leaves a deficit of around $155 million.
Observers have suggested the absence of TUSD mining in Binance’s latest launch pool contributed to the sales. Adam Cochran, the managing partner at Cinneamhain Ventures, praised the crypto exchange for not supporting the embattled asset in its latest pool.
TUSD’s Curve pool further shows it is heavily imbalanced as of press time, with crypto traders showing preferences for Tether’s USDT, Circle’s USD Coin (USDC), and DAI.
The TUSD Curve dashboard shows that the stablecoin accounts for nearly 88% of the pool’s $70,396 reserve, while USDT made up roughly 8%. The other stablecoins in the pool make up the 5% balance.
Similarly, Whale Alert also flagged the burning of 54 million TUSD tokens during the past day. Stablecoins are burned when users convert their holdings into fiat.
The stablecoin is also facing concerns over its collateral attestations report. Members of the crypto community highlighted a pause in the real-time attestation of TUSD on Jan. 10. The screenshot shared showed that the balance ripcord is usually triggered when there is an “actual imbalance of liabilities and corresponding assets.”
However, the attestation has become functional, with the stablecoin collateral at 101% on the website as of press time.
Meanwhile, the drama surrounding the stablecoin has severely impacted its supply, falling under $2 billion, its lowest level since June 2023. TUSD had seen a dramatic uptick in 2023, climbing to a peak of $3.5 billion in September from $840 million at the start of the year.
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Posted In: Binance, Stablecoins
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Oluwapelumi Adejumo
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
$0.99992
Launched in 2014, Tether is a blockchain-enabled platform designed to facilitate the use of fiat currencies in a digital manner.
USD Coin
$1.00016
USD Coin (USDC) is a stablecoin fully backed by the US dollar and developed by the CENTRE consortium.
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.