Topic: DAI and USDC depegged! (Read 327 times)

Yes, the current value is back to normal, maybe slightly less than the USD Fiat rate. There seems to be a large exchange, so the value drops. But whatever the reason, such conditions are certainly risky. It will lose the confidence of the stable coin holders. It is possible that there is an attempt to downgrade from crypto stable. I can only assume so, maybe there is some truth to what you say.

This tells us that no stablecoin can be decentralized if they depend on the centralized banking system to survive. After all, Fiat is centralized. This brings many single points of failure  crypto/Blockchain tech was meant to avoid in the first place. People are starting to distrust stablecoins after the Terra UST implosion, and now, the USDC & DAI de-peg. Things appear to be back to normal, but the damage has already been done.

Regulators need to weigh in the industry to help prevent another crisis from happening in the future. Only then, investors will feel confident on stablecoins as a true alternative to traditional Fiat. Who knows what would be of stablecoins in the long run? Just my opinion

Some numbers from BitcoinVN in which direction the USDC were flowing when the crisis reached its peak.


https://news.bitcoinvn.io/usdc-crisis-in-march-2023/

It's funny how everyone hates USDT but it is the only stablecoin that isn't been touched by any negative news this time around, many believe that USDT will be the only stablecoin worth going down, but we have forgotten that they have once been investigated in the past, all the USDT devs are visible to the law, this somehow gives me the confidence that USDT can't mess things up.

DAI de-pegged is the one that concerns me the most, Maker team has a chance to truly decentralize itself with this USDC mess, but the team decided to stick with USDC. The issue here is that we have not seen truly decentralized Stablecoins yet, there has been a lot of experimentation around this but none of them has been a true success, with one shortcoming from another, I just hope that this cycle we will see a truly decentralized Stablecoins. DAI team seems to be contented with their success so far and there has not been any improvement from them.

Am I the only one who sees USDT as a Trojan horse that is used to inflate a lot of projects and then dump them all at once?
The problem does not lie in disengagement, but rather in providing liquidity. Personally, I prefer using Dai, but they must diversify their investment basket.
Stablecoins are not investment tools and should not be held outside the platform or for long-term investment.

Stablecoins become an important factor in the cryptocurrency ecosystem, making it easy for users to transact. However, in recent times, a series of stablecoins have encountered problems. In mid-February, BUSD, the world's third largest stablecoin and tied to the Binance ecosystem, was banned from issuance. Prior to that, Luna's collapse last year also stemmed from Do Kwon's stablecoin UST failing to keep a stable 1:1 ratio and causing one of the biggest crashes in the cryptocurrency market. But cases like this will still appear in the market and this always causes confusion for investors in this market. However, I find that after incidents like this, we all need to consider the safety of assets like this, because there's really no absolute guarantee that people's money will always be safe.

Somewhere in this forum, there is a topic that discusses about USDT printing a lot of money and they believe they don't have the reserve money. But how matter the big fud is Tether seems growing  . and I also agree with the bank collapse there is

Silvergate Bank.
Silicon Valley Bank.
Signature Bank.

and Credit Suisse now acquired by UBS and somehow tether still fine Im not trying to spreading the fud but the reality is like this right


and if you know that DAI is an algorithmic stablecoin and most of their money is form of USDC so no surprise is shaking when USDC has a problem

Tether (USDT) has always been shady from the start. The stablecoin issuer used to print new units of USDT some time ago. It hasn't lost its peg since day one (AFAIK). I can't believe this, especially when trusted stablecoins like USD Coin and DAI went down the drain for a short period of time. If USDT claims to have USD reserves in a bank, then it must've suffered from the recent collapse of two major banks in the US. Something just doesn't add up.

Both USDC and DAI may've "resurrected", but I doubt investors are going to trust their money into stablecoins anymore. The industry is already tainted. Unless regulators bring bank confidence into stablecoin investors, this will mark the beginning of the end of "privately-issued" Fiat currencies for good. Perhaps, this will pave the way for a US Digital Dollar to take over the world? No one can predict the future, so we can only hope for the best. Just my opinion

I agree with your opinion to avoid stable coins at this time. because the stable coins that we know are safe are currently not doing well. ex usdc had dropped very drastically making us nervous

Last Night CZ tweet like this
"#BUSD, the most fiat-backed stablecoin, audited by big audit firms, regulated by the NYDFS, was forced to wind down (no new minting).

USDC is shrinking in market cap too due to bank closures.

USDT is growing." - https://twitter.com/cz_binance/status/1638111968027373568

Word stablecoin now is not good but somehow usdt keep growing

Well that panic was calmed six months later, the point is this is not the first time we've seen stablecoins lose pegs. However, this incident is of a more serious nature when the banking system is at risk of going out of control.
Although not absolutely safe, seeing the collapse of many big banks makes this market more and more confident.

Confidence in stablecoins has been on a constant decline ever since Terra UST went all the way down the drain. It produced a "domino effect" where other stablecoins lost their peg in an instant. Both DAI and USDC may've lost their peg for a short period of time, but the damage has already been done. I doubt investors are going to trust stablecoins anymore, after a series of unfortunate events. Only regulators will be able to restore confidence back into stablecoins by forcing issuing companies to provide proof of reserves and/or make holders "whole again".

We can't expect much from "digitized" Fiat currencies, especially when they're utterly-centralized. At least, we have decentralized cryptocurrencies by our side. As long as people are able to enjoy true financial freedom, there should be nothing to worry about. Just my opinion

You're right.I also did not believe that there would be a strong collapse and of course, many began to get nervous but I believed in a better outcome.I hope that this will not happen again in the future,because the market has just begun to grow and I would not like there to be factors that could disrupt this.

I think it was just a momentary panic caused by the bank, because everyone was panicking, then there was a mass sale, and when that happened, the price dropped quickly, but now the price has returned to normal, because it actually didn't really affect the usdc and also the incident happened on a weekend and at that time the bank was closed, and started to recover when it was Monday.

Things have turned around when things have returned to their orbit, this is not the first case of leading stablecoins no longer keeping their original value. Unfortunately this caused panic among investors, but at the same time we also see how strong the money flows into the market. For me, the recent incident was not too much of a loss, but honestly when there is a strong fluctuation like just now, it is very important to be alert so as not to lose money.

It's definitely concerning to see such a significant drop in stablecoin prices, especially if it's due to issues with the reserve funds of the companies behind them. While stablecoins can offer some advantages, it's important to remember that they are not risk-free investments.

I see this happening in this situation, high risk high return
SVB helped us witness a very exciting scenario, some big projects got into trouble and lost pegs, but then everything returned to the equilibrium it should have. And those who ventured into crypto-star stable transfers would probably make a nice profit as well.
The bankrun event this time I believe will not stop here, there are still many problems ahead that have not been made public.

But they are believed to be "100% backed" or "1:1 pegged with US Dollars". For me is also sounds fishy, we had already had an issue before about this on USD Tether by Bitfinex and what happened was a lot of people Tether was not backed 100% with US Dollars.

For me, what happened recently on stablecoins started with the Terra Luna and then the USDC de-pegged, those will become lessons for stablecoin projects. And some of the cases will not encounter again.

Stablecoins aren't safe because they're not backed by the government. They're just "private currencies" with USD reserves on a bank (collaterized stablecoins). The risk of loss is higher with algorithmic stablecoins as they're not backed by real USD reserves. I don't get why many people trust stablecoins with their hard-earned money when they're subject to failure.

If you really want to protect your investment, just sell your crypto to USD directly. There's really no other way around. With the recent collapse of USDC and DAI, I'd steer clear from stablecoins until things are sorted out by the regulators in the long run. Who knows if stablecoins are eventually replaced by CBDCs? Just my thoughts

Dangerous times have come.Many thought for a long time that these assets were not vulnerable, but this turned out not to be the case.The most important thing is that after all the fluctuations the price returned to its previous values, but now there is no confidence in these projects.

One fact that I am seeing after many years in this market is that some of the top stablecoins are experiencing similar problems. Recall the last incident involving BUSD.
Anyway, this is also a rather sensitive period; the signs of new projects and the sources of money participating in the market are gradually returning. Since the event from Terra, I keep stablecoins and should only plan DCA 5 months before.

This can be a big help especially on a very volatile marker but since last year, the collapse of UST makes a big realization to many that stablecoins are not safe at all. Many are starting to Hold Bitcoin instead of stablecoins, which i think is also ok. If there’s another depegged situation, most probably many will totally abandon stablecoins for good, that could lead into another market panic.

Stablecoins are only safe for a short period it seems, now I find it hard to keep money in stablecoins and leave it there, I wonder what will be the proper solution to this depegging issue because whether we like it or not, stablecoins are very useful for crypto investors and traders, I read some comments on Twitter, some are saying Stablecoins was never needed.

I guess stablecoin always have the risk of collapsing doesn't matter whether it's collateralized and algorithmic it's all the same, it's always the high risk lenders that causes the chain to break, even binance isn't trusting busd even though they are the one keeps promoting since then. goes to say that stablecoin only fit to be used for temporary tool for storing wealth and keeping it from inflation any longer holding would be risky to us.

Its still alarming to see such stablecoins to depegged, it looks like they are more vulnerable and not a safe coin to hold when there’s a market crash, they should be more stable though because its their purpose here in the market. Anyway, this will make the market more unpredictable and risky, hard to know if we those stablecoins are still safe or better to hold Bitcoin and just enjoy its volatility while holding.

If you are a person who prioritize safety, when those stable coins are stable again like now, you would take this chance to convert your stable coin to either Bitcoin or fiat currency.

I smell very risky to keep belief in stable coins at the moment because they can shady manage behind the scene or they just store their fiat currency in a bad bank like Silver gate, Silicon Valley bank, Credit Suite etc.

And FED has yet rescued those stable coins. They launched a cool down solution for troubling banks and problems have yet been solved entirely. The nightmare has yet ended and worst has yet come.

They've crashed, but it seems that now the peg is restored. So much for "collaterized stablecoins" that were often claimed to be a safer alternative to "algorithmic stablecoins". This tells us stablecoins are not 100% guaranteed to hold their peg for a long time. I was shocked to read DAI lost its peg, especially when it's decentralized. Only then, I've realized that MakerDAO had USD reserves on SVB just like Circle's USD Coin. It was a complete mess, but I'm glad everything got sorted out.

If the FED hasn't "rescued" SVB deposits, it would've been the end of both DAI and USDC for good. The issuers need a better strategy to prevent such catastrophe from repeating itself again. Hopefully, regulators will weigh on the industry to give a better sense of legitimacy to mainstream investors and traders alike. Who knows if Tether (USDT) would be the next stablecoin to lose its peg? Just my thoughts

Yes, it's back at it again and made a skyrocket gain today. The value and prices of those stablecoins went back again to their former although the gap is just $0.01 for it to be back exactly to $1 and that's the usual move of stablecoins.

Those that have sold didn't do their research about the backing of these stablecoins but who are we to blame them? For them, it's better to be safe than sorry but at least they should have monitored things in the market and the news that rotates around the two.

I reckon that an investor that's informed of the market that he's in, might miss some opportunities but won't panic in bad situations.

The main source of Bitcoin's fall was the collapse of Silicon Valley Bank and Silver Gate. Because of these two platforms the USDC coin is decelerating due to the peg just starting to decelerate. Due to which the candles on the BTC market and other platforms are turning red. And the Bitcoin market is now back to normal.

I never thought I’d see USDC/DAI price at this low. Things quite stable right now, and USDC/DAI market both are getting back to normal. However, common folks were making a lot of money through arbitrage profits by based on weekend hour FUD. Credit goes to those people panic sold their USDC and thought it would crash and burn like Luna/UST without having a proper understanding. So, It's necessary to educate themself first before making any quick decisions that may harm their financial stability.

We shouldn't need stablecoins to trade crypto if the platform provides trading services with USD fiat. The amount of USD circulating in a trading platform is measured based on the dollar deposit value from the bank. Likewise with other currency values. If something bad happens to a stable coin, of course this is a big blow for investors, as happened with Terra stable before.

Well, this wasn't new already. If you are here before and you are following the news around cryptos, you will be aware that the stable coin of Luna is the first one to collapse or depegged and then it followed by others. People are already warned about the possibility of the remaining stable coins that are still at the op of the list but maybe this time have finally arrived.

This is bad and I think this can cause another panic again and another dump in the overall market of cryptos. It will be okay if the impact is only applied slowly and not in an instant so that there is still a chance that the price can fight back and can recover to continue what it had started.

depended?

I've never been into spring in those pegged coins never trusted them.  Maybe it's because these types of things are inevitable.  Luna, these depegging, etc always made it feel scammish.  People throw a lot of trust in these projects and they continue to fail, rug, etc.  Bitcoin for me thanks.

I don't you haven't been reading about crypto much.  I mean I haven't been reading about it as much as I used to but I think I still have a grasp on things.  The thing is, Circle is holding some USD backing the USDC in some bank that went down so a lot of people who hold USDC have been dumping them for other stables, hence losing the peg.

And with DAI, most of DAI is backed by USDC.  Lol.

There's actually nothing safe in the market but only bitcoin. Although people might still say that it's not safe because of the volatility that it has in nature.
But with that, most traders are still keeping their profits in any stable coin that they're confident with. Such situations are giving us the idea that we should be proactive in the market because that's giving us the idea on what's happening and what could possibly happen with the projects that we invest in.
So sad to see this happen to these stable coins although that's part of the risk that even stable coins cannot skip these type of scenario. Just be sure that you're aware with all of these scenes and it can happen to other stablecoins.

Stable coins weren't always here. There used to be a time where people were only able to trade their crypto against the USD. (I mean the hard USD) Stable coins like Tether happened because the banks stopped doing business with Bitfinex. The main problem lies there.

Banks don't want to do any business with the crypto exhanges. Why do they do that? We need to fix this first.

Bitfinex couldn't fix it so they created an alternative to the USD, USDT.

Now everyone is doing the same thing and it is creating more problems than what it was supposed to fix. The space got bigger than it supposed to,  thanks to the tethers and the other stable coins because the issuers don't give a damn. They create more tokens at will whenever a systemic risk occurs. An exchange is losing liquidity? Is it going bankrupt? Quick, print more! More more more, it is never enough to feed the best completely. Once you begin the printing game there is no end to it.

The FED knows this the best and Bitfinex is just like FED except for one thing. The FED can print USD legally. Bitfinex cannot.

Even if they somehow manage to re-peg the USDC/USD pair, that is not going to fix the core problem of this business model.

Long story short, a correction in crypto is long overdue. Too many scammers around and they need to go away.

When you say avoid stablecoins, do you mean all the stablecoins and what is the alternative? Totally cashing out? Because if tether fails, every crypto fails with it. Right now those two stablecoins are slightly unpegged but every crypto out there is affected way more then dai or usdc so i don't see other cryptos as a good stablecoin alternative. USDT should hold, i am 99% sure of it.

Why artificially create problems with stablecoins? To encourage people to buy bitcoins, because bitcoin is the last thing that can turn into a cryptocurrency scam. Any Stablecoin has a team-owner, while bitcoin does not (an important advantage). Maybe soon, as a result of the problems with stabelcoin, we will see the price of bitcoin rise because of increased demand?

wouldn't have thought a stable coin could collapse almost simultaneously. this will have a slower impact on the growth of crypto which has started to improve but on the contrary is not good enough. i think a big conspiracy is being run by the rich to where to get a good start, for in the future ahead of the significant altcoin market

Probably this is the aftershock of FTX collapse once again since the fund involves is just circulating on all the project that get bankrupt.

I saw this image that explains graphically on these companies connected to each other through USDC funds.



I’m expecting more company will follow since USDC has a lot of exposure. What puzzles me is the DAI. I still don’t see their involvement to USDC while it’s token is depegged on same level with USDC. Let’s wait for the full report.

I smell that this move is related to CBDC preparation.

That's very bad news for crypto. If USDC goes down, lots of banks and other institutes will go down with it. Hell it even might affect USDT and other stable coins too. This has the potential to create a total meltdown on crypto and if crypto gets affected that widely then it would affect the stock market. That would create a very big hole in the markets. (imagine what would happen if coinbase was filing bankruptcy and right now they stopped usdc widthdrawals)

But why is that happening now? Is it because Powell's hawkish speech or was this planned long time ago?

I feel like something very big and very bad is coming towards us.

Today this 2 stable coins crash for almost 12% - 20% price decrease on the dollar. Probably this is the effect of Circle downfall due to Silvergate and Silicon Valley Bank collapse which is holding most of there reserve funds.

I don’t know what’s happening on DAI but best guess is something bad going on MakerDao. Invest safe! Avoid stablecoins for now!