Synthetix stablecoin (itsd) depends, falls to $ 0.83

The USD synthetic stable (SUSD), issued by Synthetix, has collapsed below its $ 1.00 PEP, sinking as low as $ 0.83 before recovering slightly.

This fall marks the second depends on the stablecoin in less than a year, reviving concerns about the stability mechanisms of the issuer.

Instability of PEG of triggers of excess supply

The last fall of its SD has been attributed to excess supply that floods the market, with information Citing Synthetix Core Fenway taxpayer saying that merchants are downloading the asset in large volumes. The disparity is more evident in the curve, with its D which includes 75% of the DAI-USDC-Use-Susd group, indicating that merchants are actively disinfecting the asset.

In addition to the pressure, the PEG restoration mechanism is in transition. In a series of publications on X at the beginning of the month, the founder of Synthetix, Kain Warwick, mentioned that the team was implementing new mechanisms to stabilize the plug, warning This volatility should be expected during the transition phase.

“The main driver of the purchase of its (debt management) has been eliminated,” he tweeted. “New mechanisms are being introduced, but in this transition, there will be some volatility.”

At the time of writing, the stablecoin had a price of $ 0.8593, 7.2% below its level for 24 hours and 10% for seven days. It also fell 13.3% against Ethereum (ETH) and 10.9% versus Bitcoin (BTC), highlighting its low relative performance.

The version of optimism of the asset was not saved, falling 9.4% on the last day to register a new historical minimum of $ 0.8224.

It is not the first time that Sus bumns. In May 2024, the Stablecoin experienced a similar fall after an important liquidity provider showed large quantities to the curve.

Warwick’s great SNX bet and market consequences

While Warwick insists that the plug is not at risk of a death spiral, the optics is worrying. Itsd is not just another stablecoin; It is one of the oldest after the teapot (USDT) and Trueusd (Tusd), since it has survived since June 2018. However, despite resistance, cryptographic asset is a pale shadow of its old self, dramatically contraction From its maximum capitalization of $ 500 million to approximately $ 26 million today.

Recently, the founder of Infinex revealed that he has been silently accumulating Synthetix’s native token snx and now has 35 million. This is more than double its initial position in 2018. He explained that he financed purchases by sale Up to 90% of its ETH holdings from 2020 to support Synthetix operations.

Currently, SNX is quoted at $ 0.62, an improvement of 3.4% since yesterday. Even so, the Token is red in all other deadlines, falling almost 7% in the last week and 32% during the past month. In addition, it has dropped 84% in 12 months and has fallen 97% since its historical maximum. Despite the gloomy numbers and the Sword depend, Warwick trusts, claiming that “she is not worried” by Synthetix.