Crypto crash sees that the centralized Stablecoins are retaining pegs while algorithmic tokens suffer. Two stable tokens are currently ranking among the top 10 crypto assets by market capitalization. Tether and USD are the presently ranked third and eighth crypto assets, respectively.
Moreover, they have maintained a solid grip on the dollar pegs despite the massive market downturn. According to CoinGecko, Tether and USDC coin are currently representing 80% of the $100 million combined Stablecoins capitalizations.
In addition, the total supply of all the stable coins has surged almost 190% over the past 90 days. MakerDAO’s DAI is the top decentralized stable token project. The project held in peg throughout the majority of the bearish price action.
However, May 19 was an exception when the token oscillated between find $0.996 and $1.015. Algorithmic stable columns have not fared so well, with some of them losing their pegs after the prices of underlying Collateral assets tanked.
They created UST by burning the Luna coin, which is underlying it. Thus, we can determine the value of UST by supply and demand. However, they designed the coin to be maintained by creating arbitrage opportunities for Luna’s holders.
Moreover, the price of UST is rising above a dollar. Therefore, all the Luna holders can sell the tokens for $1, which allows them to realize the opportunity and driving UST price towards $1.