The recent market volatility has caused many of the top 10 stablecoins to trade below their pegged value. Tether (USDT) remains the only major stablecoin to remain above its peg, trading at $1.01 as of this writing.
The reason for this is that Tether is backed by US dollars, and the US dollar is still seen as a safe haven asset in times of market uncertainty. This means that investors are more likely to hold USDT than other stablecoins, which are not backed by any fiat currency.
The other top 10 stablecoins, such as USDC, BUSD, PAX, and DAI, are all backed by different assets and are more susceptible to market volatility. This has caused them to trade below their pegged value, with USDC trading at $0.99, BUSD at $0.96, PAX at $0.95 and DAI at $0.94.
The reason why these stablecoins are trading below their pegged value is due to the lack of liquidity in the market. When there is less liquidity, it becomes more difficult for investors to buy and sell these coins, which leads to price drops.
It is important to note that while Tether remains above its peg, it is still subject to market volatility. In fact, it has seen a drop of over 10% since the start of the year. Therefore, investors should be aware of the risks associated with holding any stablecoin, regardless of whether it is trading above or below its pegged value.
Overall, Tether remains the only major stablecoin to remain above its peg as USDC contagion causes most top 10 stablecoins to trade below value. Investors should be aware of the risks associated with holding any stablecoin, and should always do their own research before investing.
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