DAI and USDC depegged!

[goaldigger]

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.

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.

[bussybuddy]

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.

[Mozzart]

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.

[Abiky]

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.

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

[GreatArkansas]

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.

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.
(....)

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.

[southerngentuk]

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.

[JayTrain]

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.

[bayudndy]

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.

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.

[slashz9]

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.

[Mozzart]

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.

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.

[Abiky]

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.

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

[robattfield]

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.

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.

[dansus021]

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

[cryptoknightt]

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

[Abiky]

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

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

[dansus021]

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.

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

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

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

[ElmedoRator]

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.

[hugeblack]

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

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.

[jacafbiz]

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.

[S3300]

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.