This is not the first occurrence of the USDN’s price slipping significantly from the dollar peg
Neutrino USD (USDN), an algorithmic stablecoin that is part of the Waves blockchain ecosystem, fell below its peg to the US dollar, trading at a low of $0.90 on May 13.
Crypto journalist Colin Wu reports that the Curve pool for the USDN-3 pool is now imbalanced, with USDN accounting for 93.68%. The same sort of ratios were seen in UST’s Curve pools, which could indicate that the peg is under strain and that additional deposits might be needed to restore equilibrium.
The USDN, which is expected to hold its price at $1, fell to $0.84 on Bittrex on May 8, showing signs of weakness earlier.
This is not the first occurrence of the USDN’s price slipping significantly from the dollar peg. On April 6, USDN lost its peg and tumbled as low as $0.34 after users accused the platform of manipulating the price of the WAVES token through its decentralized finance (DeFi) lending platform, Vires. finance.
USDN is the algorithmic stablecoin of the Waves protocol, and it is designed similarly to the algorithmic stablecoin of the Terra blockchain, UST. To mint the USDN, users must lock the WAVES token into Neutrino smart contracts, while USDN buybacks destroy the stablecoin and unlock the WAVES supply, balancing supply and demand and maintaining pecking of the stablecoin.
Terra UST Collapse
The impact of Terra’s UST collapse landed big on the stablecoin landscape, with lesser algorithmic stablecoins facing additional pressure as their prices wobbled.
As previously reported by U.Today, Tether, the third-largest cryptocurrency and largest stablecoin, briefly lost its peg as its price dropped to $0.97 for a while.
The event that created fear in the cryptocurrency market with Bitcoin and the altcoins suffering significant losses has since been restored as USDT recovered back to $1.
At press time, the USDN was changing hands at $0.93, gradually approaching the peg at $1.
