On June 15, there was a slight deviation observed in the value of the tether (USDT) stablecoin from its pegged rate to the united states dollar. This deviation was attributed to an imbalance within the curve’s 3Pool system. As a consequence, the price of USDT experienced a 0.3% decline, reaching approximately 0.997, while its weightage within the curve 3pool surged to over 70% from its typical 33.1% level.
The stablecoin pool known as Curve’s 3pool is an integral part of decentralized finance, housing substantial liquidity comprising the three leading stablecoins: USDT, USD Coin (USDC), and DAI. when there is a notable increase in the weightage of a specific stablecoin within this pool, it signifies a considerable amount of that asset being sold off.
Source: TradingView
As of now, the weightage of USDT in Curve’s 3pool stands at approximately 73.8%. This indicates a growing trend among traders who are opting to sell their USDT holding in favor of DAI or USDC. it’s worth noting that the concentration of USDT in curve’s 3pool had previously surpassed 50% during the FTX collapse bake in November 2022.
Source: Curve
The primary factor behind the imbalance in Curve’s 3pool can be traced back to a whale address named CZSamSun. This particular address borrowed a substantial amount of 31.5 million USDT and subsequently exchanged it for USDC, resulting in a slight deviation from the intended value of USDT’s peg to the U.S. dollar. To carry out this transaction, CZSamSun utilized 17,000 Ether and 14,000 staked Ether (stETH) as collateral and leveraged the 1inch Network to convert the borrowed funds into USDC.
Following the borrowing and swapping activities, the borrower proceeded to deposit a sum of $10 million into Aave v2 and $21 million into Aave v3. Subsequently, a USDT loan of 12 million was taken out from v3 and deposited into v2.
Around 20 minutes after CZSamSun’s USDT borrowing, another address (0xd2…0701) utilized 52,200 staked Ether (stETH) as collateral through Aave v2. Taking advantage of the price disparity between USDT and USDC, this address borrowed 50 million USDC.
The slight deviation in the price of USDT had a positive impact on the USDC/USDT trading pair on Binance, causing it to reach a new yearly high of $1.0034. Within Curve’s 3pool, USDT constituted 73.79% of the total, while DAI accounted for 13.05% and USDC held 13.16% of the pool.
Paolo Ardoino, the Chief Technology Officer of Tether, recently utilized Twitter to alleviate concerns within the crypto community regarding the depeg scare, emphasizing that there is no need to fret as the company is fully prepared to redeem any quantity involved. furthermore, Adroino engaged within the market rumors surrounding Tether’s depeg by sharing a “FUD meme” and addressing them directly.
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