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<div class="cryptonews"> 
 <p class="is-style-lead">Stablecoins from Circle and MakerDAO have been less stable than those from Tether and Binance in the last couple of years, states a new S&amp;P Global report.</p> 
 <p>Analysts at S&amp;P Global have noted that while all dollar-pegged stablecoins are <a rel="noopener noreferrer nofollow" title="susceptible" href="https://thebittimes.com/tag/susceptible.html">susceptible</a> to fluctuations, certain ones, like Circle’s USD Coin (USDC) and MakerDAO’s Dai (DAI), have exhibited a greater tendency to depeg compared to others.</p> 
 <p>A comprehensive study conducted in September by Dr. Cristina Polizu, Anoop Garg, and Miguel de la Mata analyzed the valuation and depegging trends of five prominent stablecoins: USDT, BUSD, Paxos (USDP), USDC, and DAI.</p> 
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 <p>The findings highlighted that USDC and DAI have experienced more frequent depegging incidents than their counterparts, USDT and BUSD, over the past two years.</p> 
 <p>Notably, USDC’s value plummeted below $0.90 for 23 minutes, and DAI’s value dipped for 20 minutes in the most significant depegging event recorded during the study period. In contrast, USDT’s value fell below $0.95 for a solitary minute, and BUSD consistently maintained a value above $0.975 from June 2021 to June 2023.</p> 
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  <img decoding="async" width="758" height="487" src="https://cdn.thebittimes.com/images/2023/09/12/42e58dfc920f446bfb328c311662a90d.webp" alt="USDC and DAI more susceptible to de-pegging, say analysts - 1" class="wp-image-14193852"> 
  <figcaption class="wp-element-caption">
    Stablecoin de-pegging over time | Source: S&amp;P Global. 
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 <p>Furthermore, the study revealed that the occurrences of depegging were considerably higher for USDC and DAI than for USDT and BUSD throughout the analyzed timeframe.</p> 
 <p>The researchers pointed out that brief depegging events lasting for a minute could be disregarded as noise, mainly when the deviations were near the $1 mark. However, extended depegging durations were perceived as more significant, with the data favoring USDT over USDC.</p> 
 <figure class="wp-block-image size-full"> 
  <img decoding="async" width="776" height="482" src="https://cdn.thebittimes.com/images/2023/09/12/aa843ec9ff61cdeb687be1a98d625ac6.webp" alt="USDC and DAI more susceptible to de-pegging, say analysts - 2" class="wp-image-14193853"> 
  <figcaption class="wp-element-caption">
    Frequency of stablecoin de-pegging | Source: S&amp;P Global. 
  </figcaption> 
 </figure> 
 <p>A significant event that contributed to USDC’s devaluation was the collapse of the Silicon Valley Bank in March 2023. At that juncture, Circle, the issuer of USDC, had parked $3.3 billion of its $40 billion USDC reserves with the bank. Concurrently, MakerDAO held over 3.1 billion USDC in reserves, which were utilized as collateral for DAI, thereby leading to its depegging.</p> 
 <p>The researchers accentuated the necessity of robust governance, sufficient collateral, and reserves, alongside market confidence and adoption, to maintain the peg and a stable mechanism. They concluded that these factors are pivotal in ensuring the stability of a stablecoin.</p> 
 <p>Furthermore, the market dynamics have shifted, with USDT expanding its supply by 25% since the onset of the year, thereby commanding a dominant market share of 67%. This growth seems to have occurred at the expense of Circle, which observed a 41.5% reduction in USDC supply and a decline in market share to 21% during the same timeframe.</p> 
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<p>Source: <a rel="noopener noreferrer nofollow" target="_blank" href="https://thebittimes.com/usdc-and-dai-more-susceptible-to-de-pegging-say-analysts-tbt62397.html">https://thebittimes.com/usdc-and-dai-more-susceptible-to-de-pegging-say-analysts-tbt62397.html</a></p>

USDC and DAI more susceptible to de-pegging, say analysts

TheBitTimes

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