Unstable Coins: Price-Pegged Cryptocurrencies Are Going Haywire
The ever-expanding landscape of price-pegged stablecoins has been slapped with a surge of volatility, as multiple coins have experienced price swings as much as 10% in the last day.
— Sun Crypt (@sun_crypt) October 15, 2018
Much of this trading action has seemingly been driven by Tether (USDT), which roughly accounts for 98% of the total daily trading volume of all stablecoins. USDT, which is pegged 1:1 with the U.S. dollar, is currently down around $0.05 as users rush to liquidate holdings.
As a result, other major stablecoins have behaved rather strangely. For instance, Paxos (PAX) and TrueUSD (TUSD) are both currently up over 5%. Even Gemini’s highly regulated Gemini Dollar (GUSD) is currently up roughly 3.3%.
This price action may indicate that investors are liquidating their USDT holdings in order to protect capital in Bitcoin (BTC) and the aforementioned, competing stablecoins.
Ultimately, this odd price action has helped drive the larger crypto market higher, as the AltDex 100 Index (ALT100), a benchmark index for large-cap cryptocurrencies and tokens that notably does not include stablecoins, is currently up 4.8%.
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.