1/ The Stablecoin Wars are heating up.
There are significant changes in the stablecoin positioning that went largely unnoticed.
So, these are the biggest developments🧵
There are significant changes in the stablecoin positioning that went largely unnoticed.
So, these are the biggest developments🧵
2/ Collapse of Near's $USN and Huobi's $HUSD
USN launched as an algorithmic stablecoin just 7 months ago.
But after UST collapse, USN v2 transitioned to minting USN with USDT.
Yet a '$40M missing collateral gap' appeared due to double-minting and the project was shut down.
USN launched as an algorithmic stablecoin just 7 months ago.
But after UST collapse, USN v2 transitioned to minting USN with USDT.
Yet a '$40M missing collateral gap' appeared due to double-minting and the project was shut down.
3/ Since USN shut down, TVL on Near dropped by 44.7% from $297M to the current $164M.
USN V2 roadmap included plans to back USN with stablecoins and non-stablecoin assets (e.g. NEAR).
Yield to USN holders would have been generated from NEAR staking returns.
USN V2 roadmap included plans to back USN with stablecoins and non-stablecoin assets (e.g. NEAR).
Yield to USN holders would have been generated from NEAR staking returns.
4/ Huobi's HUSD is currently at trading at $0.28 USD
It happened following the Huobi's acquisition by Justin Sun (which he denies), and Huobi delisting of HUSD.
HUSD was the backbone of Huobi ECO Chain, but HECO will 'merge' with Tron & BitTorrent Chains.
Bye HECO 👋
It happened following the Huobi's acquisition by Justin Sun (which he denies), and Huobi delisting of HUSD.
HUSD was the backbone of Huobi ECO Chain, but HECO will 'merge' with Tron & BitTorrent Chains.
Bye HECO 👋
5/ Interestingly, Huobi announced that it had sold HUSD business already in 2022 after a 'friendly negotiation with HUSD's issuer.'
Huobi converted all HUSD to USDT, so if you want to convert HUSD to USD 1:1 ratio, you'll need to contact the issuer.
Arbitrage opportunity here?
Huobi converted all HUSD to USDT, so if you want to convert HUSD to USD 1:1 ratio, you'll need to contact the issuer.
Arbitrage opportunity here?
6/ The story doesn't end here.
Dethroned $HUSD is being replaced with Tron's $USDD. Though only 10 markets are open for now.
Justin is really pushing for higher $USDD and Tron adoption.
Dethroned $HUSD is being replaced with Tron's $USDD. Though only 10 markets are open for now.
Justin is really pushing for higher $USDD and Tron adoption.
7/ $USDD is one of the few algorithmic stablecoins still standing.
USDD is MINTED solely by $TRX at 1:1 ratio, and only by pre-approved Members.
But Tron DAO Reserve claims that USDD is BACKED by other crypto assets at 293% collateral ratio.
USDD is MINTED solely by $TRX at 1:1 ratio, and only by pre-approved Members.
But Tron DAO Reserve claims that USDD is BACKED by other crypto assets at 293% collateral ratio.
8/ Surprisingly, $USDD was last minted or issued in July 17th.
USDD market cap has not changed since then and it stands at $700M USD.
Anyway, listing USDD on Huobi creates a new use case for the stablecoin besides degen yield farming.
USDD market cap has not changed since then and it stands at $700M USD.
Anyway, listing USDD on Huobi creates a new use case for the stablecoin besides degen yield farming.
9/ Another algorithmic stablecoin fighting for survival is $USDN
USDN suffered 3 major depegs with the worst one in April.
Since then $USDN has been struggling to keep $1 USD peg as it is not 100% backed by $WAVES collateral anymore.
USDN suffered 3 major depegs with the worst one in April.
Since then $USDN has been struggling to keep $1 USD peg as it is not 100% backed by $WAVES collateral anymore.
10/ Similarly to $UST or USDD, Neutrino's $USDN is backed by its native token $WAVES
Since the liquidity crunch on Vires finance in April, the backing ratio (BR) has fallen way below 100%.
BR currently stands at 25%, thanks to multiple market interventions.
Since the liquidity crunch on Vires finance in April, the backing ratio (BR) has fallen way below 100%.
BR currently stands at 25%, thanks to multiple market interventions.
11/ On a more positive note, $LUSD has managed to grow its market cap by 13% in the past month alone.
@LiquityProtocol launched an innovative bonding mechanism with dynamic NFTs - Chicken Bonds.
But the core value added is increased security against insolvency.
@LiquityProtocol launched an innovative bonding mechanism with dynamic NFTs - Chicken Bonds.
But the core value added is increased security against insolvency.
12/ As more $LUSD is bonded for $bUSD, LUSD is deposited to the Stability Pool.
Because LUSD Troves (collateralized debt positions) have low liquidation threshold (110%), this Stability Pool acts as the first line of defense in maintaining solvency.
Flywheel effect at its best.
Because LUSD Troves (collateralized debt positions) have low liquidation threshold (110%), this Stability Pool acts as the first line of defense in maintaining solvency.
Flywheel effect at its best.
13/ The elephant in the room for decentralized stablecoins is $DAI
At $5.8b MC it's the largest #DeFi stablecoin with $FRAX behind ($1.2b)
The DAO just passed the most important vote in its history: potentially abandoning USD peg, launching MetaDAOs, and MetaDAOs token farming.
At $5.8b MC it's the largest #DeFi stablecoin with $FRAX behind ($1.2b)
The DAO just passed the most important vote in its history: potentially abandoning USD peg, launching MetaDAOs, and MetaDAOs token farming.
14/ It's quite surprising how little publicity the vote has aroused relative to its significance.
I'd guess it's due to the plan's complexity.
The Endgame Plan assumes eventual regulatory crackdown on real world assets collateral, which includes $USDC.
Learn more below 👇
I'd guess it's due to the plan's complexity.
The Endgame Plan assumes eventual regulatory crackdown on real world assets collateral, which includes $USDC.
Learn more below 👇
15/ Abracadabra's $MIM, once a serious competitor to DAI, is now down -96.6% (market cap).
$FTT is the largest collateral asset for MIM, so FTT decline is not great news for Abracadabra.
$FTT is the largest collateral asset for MIM, so FTT decline is not great news for Abracadabra.
16/ $DAI free float won't happen overnight, but we can expect the launch of two other DeFi stablecoins soon: $GHO and $crvUSD
• Details on $crvUSD are scarce
• Aave's $GHO might have revenue sharing model for $AAVE staking
• Details on $crvUSD are scarce
• Aave's $GHO might have revenue sharing model for $AAVE staking
17/ Yet the biggest change in terms of stablecoin market cap is the decline of $USDC
2 months passed since Binance 'delisted' USDC.
Since then USDC market cap has dropped by 15.9% while BUSD grew by 14.3%
That's an $8.2B drop in MC for USDC, which is more than DAI's entire MC!
2 months passed since Binance 'delisted' USDC.
Since then USDC market cap has dropped by 15.9% while BUSD grew by 14.3%
That's an $8.2B drop in MC for USDC, which is more than DAI's entire MC!
18/ Now it all comes to what FTX will do.
And they want to take part in the 'Second Great Stablecoin War'
SBT recently told that the FTX stablecoin launch is 'not-too-distant future.'
They'll do it in cooperation with a partner.
Who will it be ? 🤔
And they want to take part in the 'Second Great Stablecoin War'
SBT recently told that the FTX stablecoin launch is 'not-too-distant future.'
They'll do it in cooperation with a partner.
Who will it be ? 🤔
19/ Quite appropriately for the current FTX vs Binance situation, SBT made an insightful comment about stablecoins:
'by now they've all learned the core lesson: NEVER EVER BLOCK REDEMPTIONS or your stablecoin will no longer be stable'
Same for exchange withdrawals 😎
'by now they've all learned the core lesson: NEVER EVER BLOCK REDEMPTIONS or your stablecoin will no longer be stable'
Same for exchange withdrawals 😎
20/ Finally, $USDT
Last month Tether reduced commercial papers to zero, and increased exposure to US Treasuries
Tether previously condemned rumours that its commercial paper is '85% backed by Chinese or Asian commercial papers and being traded at a 30% discount.'
Last month Tether reduced commercial papers to zero, and increased exposure to US Treasuries
Tether previously condemned rumours that its commercial paper is '85% backed by Chinese or Asian commercial papers and being traded at a 30% discount.'
21/ Overall, stablecoin market isn't static as the total market cap would suggest.
Centralized stablecoins dominate the market with its decentralized counterparties struggling to compete.
I previously analyzed 25 #DeFi tokens, so check it if you want to learn more.
Centralized stablecoins dominate the market with its decentralized counterparties struggling to compete.
I previously analyzed 25 #DeFi tokens, so check it if you want to learn more.
22/ Did I miss something important?
Follow me @DefiIgnas for more.
Like/Retweet the first tweet below if you can:O
Follow me @DefiIgnas for more.
Like/Retweet the first tweet below if you can:O
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