Stablecoin

USDC

Terra

Coin

<ul class="news-points"> 
 <li>Two significant stablecoin liquidity drops have occurred since Terra and FTX crashed.</li> 
 <li>Last September 2022, the Fed raised interest rates by 75 basis points from 2.33% to 3.08%.</li> 
 <li>The USDT and USDC liquidity dropped by $1 billion, equivalent to a 55% drop following the rate hike.</li> 
</ul> 
According to Tom Wan, Research Analyst at 21.co, two significant <a href="https://coinedition.com/what-is-a-stablecoin/">stablecoin</a> liquidity drops have occurred since Terra and FTX crashed. Wan used on-chain data to identify a corresponding behavior in the USDT and USDC liquidity on AAVE V2 as measured against the Fed’s fund rate. 
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 .<a href="https://twitter.com/aave?ref_src=twsrc%5Etfw" target="_blank" rel="nofollow">@aave</a> V2 USDT+USDC Liquidity vs FED Fund Rate 2 Significant drop in liquidity post Terra &amp; FTX Sep 2022: – FED raises 75bps from 2.33% to 3.08% – USDT &amp; USDC liquidity dropped by $1B (-55%) Jul 2023: – FED raises 25bps from 5.08% to 5.33% – USDT &amp; USDC liquidity dropped by… <a href="https://t.co/Vi65UjbWbk" target="_blank" rel="nofollow">pic.twitter.com/Vi65UjbWbk</a>— Tom Wan (@tomwanhh) <a href="https://twitter.com/tomwanhh/status/1722876480655646803?ref_src=twsrc%5Etfw" target="_blank" rel="nofollow">November 10, 2023</a>
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The research analyst recently posted about the correlation between the Fed’s fund rate and the stablecoin liquidity on X. In the post, Wan revealed that in September 2022, the Fed raised interest rates by 75 basis points from 2.33% to 3.08%. Following the interest rate incre…
The post <a href="https://coinedition.com/the-feds-fund-rate-correlates-with-stablecoin-liquidity-analyst/">The Fed’s Fund Rate Correlates With Stablecoin Liquidity: Analyst</a> appeared first on <a href="https://coinedition.com">Coin Edition</a>.

The Fed’s Fund Rate Correlates With Stablecoin Liquidity: Analyst

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