Aave

Ethereum

With $USDT trading below $1, the sudden small de-peg of <a target="_blank" href="https://tokeninsight.com/zh/coins/tether/overview">$USDT</a> from the dollar creates an arbitrage opportunity for traders, either betting further depeg or betting the dollar peg will recover.One notable case of betting further de-peg was an Ethereum address known as <a rel="noopener noreferrer nofollow" target="_blank" href="https://debank.com/profile/0x9026a229b535ecf0162dfe48fdeb3c75f7b2a7ae/history?chain=eth">czsamsun.eth</a>, who, using 17,400 ETH ($28 million) and 14,690 stETH ($24 million) as collateral, borrowed $31.5 million USDT from Aave 2 and exchanged it for 31.47 million USDC at a rate of $0.997 on Curve.At the same time, someone is betting the dollar peg will recover. An address <a rel="noopener noreferrer nofollow" target="_blank" href="https://etherscan.io/address/0xd275e5cb559d6dc236a5f8002a5f0b4c8e610701">0xd2</a>, capitalized on the USDT de-peg in a big way. This address <a rel="noopener noreferrer nofollow" target="_blank" href="https://debank.com/profile/0xd275e5cb559d6dc236a5f8002a5f0b4c8e610701/history">deposited</a> 52,200 stETH ($85 million) through Aave V2 and borrowed $50 million USDC, swapping large sums of USDT at a discounted rate in batches.Here, the trader took advantage of the lower price of USDT to buy large quantities using borrowed USDC, which was still holding its 1:1 peg with the US dollar. In theory, if USDT returns to its 1:1 peg, the traders can sell their USDT at a profit, repay their borrowed USDC and pocket the difference.In response to this sudden demand for USDT loans, Aave’s algorithmic model automatically adjusted its rates to maintain market equilibrium. The result was a significant rate hike, with the deposit rate soaring to over 15% and the borrowing rate increasing by over 25%.<img src="https://s2.tokeninsight.com/static/calendar/img202306150443570bed0c61-9776-49bb-a734-d913a4637bb2.jpg">&nbsp;<a target="_blank" href="https://tokeninsight.com/en/cryptocurrencies">TokenInsight</a> is dedicated to covering the most important and cutting-edge trends in the world of crypto. If you have information to share with us, please feel free to contact our email <a href="mailto:news@tokeninsight.com">news@tokeninsight.com</a>. Your trust will be well respected.

Traders Started to Arbitrague the $USDT de-peg

TokenInsight

Other articles published on Jun 15, 2023

XRPL Official Notices Odd XRP Activity on Poloniex, Here's What Happened

SEC and Binance.US Propose Consent Order to Ease Asset Restrictions

Unstoppable Ethereum: With AWS Down, Crypto Prevails

OKX Ventures Report: A Closer Look at Oracles’ Impact on the Web3 Landscape

Tether 'Ready to Redeem Any Amont' of $USDT amid Curve 3pool Unbalance, CTO Says

Gather Network added to Wanchain's cross-chain infrastructure

Join our free newsletter for daily crypto updates!