On May 2nd, TUSD, the TrueUSD stablecoin, experienced a sharp depegging on several cryptocurrency exchanges, reaching a high of $1.20 relative to USDT on Binance. This event caught the attention of the cryptocurrency community, as someone had been adding liquidity in massive size to the TUSD-USDT pair, making it the most liquid pair on Binance after a $200 million injection of orderbook liquidity at the 1% level, according to Kaiko, a leading cryptocurrency market data provider.
The sudden depegging of TUSD led to speculation that someone may have been attempting to manipulate the market, as heavy borrowing of TUSD was also reported. However, the identity of the borrower remains unknown at this time.
Despite the temporary disruption in TUSD’s peg, it has since stabilized and is currently trading at its normal peg of $1.00. This incident highlights the importance of maintaining a stable peg for stablecoins, as they are designed to be a reliable and consistent store of value for cryptocurrency traders and investors.