In the wake of the USD Terra case, other similar assets have also been delinked. One investor is even suing Coinbase for the collapse of a stable coin, which is not UST.
After the historic UST incident, some stablecoins The less popular currencies have experienced difficulties in maintaining their expected stable level of $1.
Como ha estado reportando DiarioBitcoin , USD Land (UST), la moneda estable algorítmica nativa de Earth The dollar, which lost its 1:1 parity with the greenback this week. The incident, as in a domino effect, negatively impacted the token a digital unit designed with utility in mind, providing access and use of a larger crypto economic system. brother LUNA, with which UST is linked, whose price has now plummeted to zero.
Despite the efforts of the Earth to save a ambas criptomonedas, el proyecto ahora parece haberse ido por el drenaje. La cadena de bloques Earth was offline for over 7 hours this morning, as UST and LUNA have erased the multi-billion dollar capitalizations that a week ago positioned them among the leading cryptocurrencies in the market.
The phenomenon, which has caused a lot of controversy in the ecosystem this week, seems to be spreading to other assets in the market as well. On Wednesday we reported thatTether (USDT), the largest stablecoin a cryptocurrency with extremely low volatility, sometimes used as a means of portfolio diversification. Examples include gold-backed cryptocurrency or fiat-pegged cryptocurrency. by market capitalization, momentarily lost its parity reaching USD $0.95. The roll out coincided with a massive drop in the market that saw Bitcoin the biggest and most popular cryptocurrency in the world. It is a decentralized digital currency that enables users to make trustless peer-to-peer transactions. below USD $30,000.
USDX, USDN, and others are unbundled
In the meantime, others stablecoins smaller ones also seem to be experiencing the negative effects of the collapse. As reported byThe Block a file containing information on transactions completed during a given time period. Blocks are the constituent parts of a blockchain.the decentralized decentralization refers to the property of a system in which nodes or actors work in concert in a distributed fashion to achieve a common goal. stable currency of Kava Network a network refers to all nodes in the operation of a blockchain at any given moment in time. USDX has been volatile this week. Similar to the movements that UST has seen, USDX has seen ups and downs in price and has failed to hold its $1 level.
According to data from CoinGecko the asset of Kava Network reached as low as 5 cents on Wednesday, coinciding with the timing of UST’s collapse. By the time of editing, USDX has failed to achieve its stability and is trading at USD $0.63.
In a similar effect, Neutrino USD (USDN) an algorithmically stable currency that is part of the blockchain a distributed ledger system. A sequence of blocks, or units of digital information, stored consecutively in a public database. The basis for cryptocurrencies. ecosystem of Waves also fell below its expected level. Journalist Colin Wu reported on the unwinding of the asset this Friday, as picked up by U.Today in a note, stressing that USDN had fallen to 76 cents on Thursday.
The data from CoinGecko also show the fall of the stable currency of Waves . Although it has recovered its losses, USDN still seems to be struggling to maintain its parity with the USD. At the time of writing it was trading at USD $0.944.
As previously reportedCryptoNewsthe effect was extended to other stable currencies such as sUSD (SUSD), a synthetic stable-currency asset in Synthetix ( SNX ); Zasset zUSD (ZUSD), una stablecoin The dollar-backed programmable bonds, which were also highly volatile. Even the recently launched stablecoin decentralized Tron USD, USDD, was volatile on Wednesday amid the events.
UST Effect? The market an area or arena, online or offline, in which commercial dealings are conducted. “stabilizes”.
Although to a lesser extent, the stable currencies BUSD, de Binance and USDC, the second-largest of its kind by market capitalization, also saw unusual movements amid the collapse of UST, and the momentary disengagement ofTether. The waters seem to have calmed down as the three main stablecoins -USDT, USDC and BUSD – change change — a concept relevant to cryptocurrencies that use the UTXO model — is the number of coins sent back to a user after they use their unspent outputs to initiate a transaction. hands at dollar prices.
However, it should be noted that the link to the US dollar did not appear to be the only common factor, as other seemingly stable assets linked to other fiat fiat currency is “legal tender” backed by a central government, such as the Federal Reserve, and with its own banking system, such as fractional reserve banking. It can take the form of physical cash, or it can be represented electronically, such as with bank credit. currencies also showed similar behaviour. As reported by the same media outlet, the BiLira (TRYB), a stable currency backed by the Turkish lira, fell to as low as USD $0.05 on Wednesday.
This is not the first time that an asset has “ stable ” is destabilizing. In 2017, in the midst of the bull a person that is optimistic and confident that market prices will increase, this person is also known to be "bullish" about the market or price. run,Tether experienced a similar momentary disengagement. Although the recent event has undoubtedly made history, as it was the first time that so many people have stablecoins The market and investors are reeling at the same time; a phenomenon that reverberated more broadly to the market and investors.
In fact, a group of Coinbase is an American company that operates a cryptocurrency exchange platform. is particularly upset about a similar occurrence involving a stablecoin linked to the Japanese yen. The exchange businesses that allow customers to trade cryptocurrencies for fiat money or other cryptocurrencies. is facing legal action for its role in promoting GYEN, a stablecoin that, they allege, failed to keep its promise of parity with the Japanese currency currency is a medium of exchange that defines value. after rising and then falling 80%. . The medium Bloomberg reported about the lawsuit this week.
It is unclear what could have caused so many stablecoins simultaneously staggered in the midst of the UST collapse, but one possible reason is the mutual correlation of several of these assets and their role in the market. For example, in the case of USDX, the stablecoin de Earth represented one of the back-up assets, along with others such as Kava , Bitcoin yEther the form of payment used in the operation of the distribution application platform, Ethereum..
It is possible that as UST exits the system, and as its use in decentralized finance (DeFi) and other markets declines, the other stablecoins could start to stabilize, as the team estimates Kava Network for USDX. “ USDX is not UST. Once UST is out of the system, it is anticipated that USDX will return to its parity. “said Scott Stuart, co-founder and CEO of Kava Labs .
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Article by Hannah Estefania Perez / DiarioBitcoin
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