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Analyst Highlights TUSD Depreciation in Response to Binance's FDUSD Emphasis

Jan 17, 2024 at 05:51 am

In December, Binance implemented a zero-fee trading policy for FDUSD, enticing users to actively participate in selling activities. The stablecoin TrueUSD (TUSD) currently finds itself deviating from its intended $1 peg during the Asian business day.

Data obtained from the Binance crypto exchange illustrates a noteworthy trend over the last 24 hours. TUSD has experienced sell orders surpassing $444 million, in stark contrast to buy orders totaling $301 million, resulting in a significant net flow deficit of $142 million.

Source: BinanceSource: Binance 

During a Telegram interview, Bradley Park, an analyst at CryptoQuant, provided valuable insights into TUSD's decline. He linked the depreciation to TUSD's association with Justin Sun and the ongoing reduction in its market capitalization. Park speculated that this downward trend might be influenced by potential repercussions stemming from the HTX and Poloniex hacks.

Park further emphasized the impact of Binance's strategic decisions on TUSD. The elimination of fees on FDUSD trading pairs involving ether (ETH), BNB Chain's BNB, dogecoin (DOGE), and Solana's SOL, combined with the exclusion of TUSD as an option for staking new tokens on Binance's Launchpad, played a role in the overall decline.

Source: CryptoQuantSource: CryptoQuant 

The increase in FDUSD volume, coinciding with TUSD's departure from its peg, suggests a shift towards FDUSD for participation in the FDUSD launch pool and inclusion in the Binance Manta launchpad. The launchpad, a popular service, rewards investors with new tokens in exchange for locking up specific assets, such as FDUSD or BNB, for a predetermined period.

"We believe that TUSD holders sold as the Launchpad pool did not open, causing the de-pegging,"

Park commented, shedding light on the dynamics influencing TUSD's current situation.

Despite ongoing concerns about TUSD's attestations, a spokesperson for Techteryx, the entity behind TUSD, reassured that attestations are proceeding as usual. They underscored that any assertions to the contrary are unfounded and clarified that Justin Sun is not a shareholder of Techteryx.

The spokesperson also acknowledged recent community mining activities associated with Binance Launchpool, recognizing short-term arbitrage opportunities as part of the normal market dynamics and liquidity adjustments.

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