Binance USD (BUSD), the third-largest stablecoin by market cap, quickly dropped to a low of 20 cents against the DAI stablecoin on Wednesday morning as liquidity dried up on the Binance crypto exchange.

The plunge was triggered by a single $647,000 market sell order, which prompted a cascade of slippage down to 20 cents. BUSD immediately regained its peg on Binance against DAI as arbitrage traders could feasibly purchase it for below $1 on Binance and sell for $1 on another exchange.

At press time, there are $3.38 million in aggregated sell orders down from the $1 dollar peg to 20 cents, meaning that it would require a $3.38 million market sell to again take price to that level, according to Binance's orderbook.

For Wednesday's $647,000 sell order to trigger a move to the downside of that magnitude meant liquidity was either pulled from the book shortly before the sale was made, or a pricing error failed to account for resting buy orders.

BUSD has been embroiled in a regulatory tussle after the New York Department of Financial Services (NYDFS) ordered Paxos to stop issuing the stablecoin, a move that will see BUSD supply trend towards zero over time.