@marlinmdmoorelf
Stablecoin de-pegging events significantly impact market sentiment because they undermine trust in crypto’s foundational liquidity layer. If a major stablecoin like USDT or USDC temporarily loses its peg, traders panic, fearing systemic risk. This often triggers rapid sell-offs across multiple assets, as stablecoins serve as the main trading pair and collateral in DeFi. Even minor deviations below $1 create uncertainty about solvency and transparency. Recovery from such events is slow, as confidence once shaken is difficult to restore. Overall, de-pegging events magnify volatility, erode investor trust, and highlight the fragility of crypto’s reliance on stable value tokens.
0 reply
0 recast
0 reaction