The stablecoin TrueUSD (TUSD) is still not out of the woods with its de-peg crisis. Over the last 24 hours, more than $238 million worth of TUSD was sold on Binance, the stablecoin’s biggest supporter, causing the de-peg crisis to deepen and the stablecoin’s value to drop to $0.9708.
TUSD Price Drops to $0.9708
The price of the stablecoin TUSD dropped to $0.9708 around 06:00 today. Current data shows that TUSD has recovered slightly after this drop and is now trading around $0.9882.
On January 15th, the stablecoin lost its peg to the US dollar and fell below the $1 mark as users reportedly sold hundreds of millions of dollars worth of TUSD. Data compiled from Binance shows that investors on the cryptocurrency exchange sold approximately $238.3 million worth of TUSD through the TUSD/USDT trading pair in the last 24 hours. In contrast, there were purchases of TUSD worth $83.8 million, indicating a net outflow of approximately $154.5 million for the stablecoin.
What’s Behind TUSD’s De-Peg Crisis?
It was revealed on January 10th that TrueUSD had paused the real-time verification of its reserves, and a user raised suspicions that the company could not back its tokens, triggering the de-peg crisis. The company stated that the pause in real-time verification was due to a technical issue and attempted to regain control of the process, but was unsuccessful.
TrueUSD announced on January 17th that it had completely updated its fiat reserve audit system in collaboration with the Hong Kong-based accounting firm MooreHK. The updated attestation report includes additional details about the reserve funds under the supervision of financial and trustee partners, according to TrueUSD’s statement.
According to Justin d’Anethan, APAC business development manager at crypto market maker Keyrock, the primary reason for TUSD losing its peg to the US dollar is the promotion of BNB and FDUSD on Binance Launchpool. d’Anethan shared his view, noting that “Recently, MANTA was announced on Binance’s Launchpool, and it was stated that BNB or FDUSD could be staked for farming. In the past, other stablecoins like TUSD were used for launchpool staking. It seems like Binance Launchpool users are now selling TUSD to acquire FDUSD.”
Nick Ruck, the business manager at ContentFi Labs, pointed to the hack attack on Poloniex as a possible reason for the de-peg crisis of TrueUSD, which is thought to be associated with TRON founder Justin Sun. Ruck suggested that the $100 million hack attack on the cryptocurrency exchange Poloniex might have affected TUSD.