The HUSD stablecoin, which is issued by Stable Universal, has fallen to 92 cents, an 8% drop from its planned $1 peg, according to CoinMarketCap prices.
It is trading as low as 89 cents against the USDC stablecoin on decentralized finance (DeFi) protocol Curve Finance. The so-called depeg occurred 16 days after crypto exchange FTX removed HUSD from its basket of support USD stablecoins.
A stablecoin is a cryptocurrency designed to hold its value against another asset. This can be in the form of algorithmic stablecoins or reserve-backed coins, of which HUSD is an example. The stablecoin sector has been under intense regulatory scrutiny this year following the implosion of algorithmic stablecoin terraUSD (UST), which saw $18.71 billion evaporate alongside the collapse of Terra's LUNA token.
A year ago, HUSD published a breakdown of reserves that showed every issued token was backed by U.S. dollars held in cash in money market accounts. At press time HUSD has a market cap of $149.5 million.
HUSD is issued by Stable Universal and can be redeemed on a 1:1 basis against the U.S. dollar, according to the company's website.
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Typically, when redemptions are live the price will gravitate toward the peg because if it's lower, traders can purchase tokens at a discount on an exchange and redeem for a full dollar through the company's website.
Stable Universal did not immediately respond to CoinDesk's request for comment.