USX, a Solana-derived stablecoin pegged to the U.S. dollar, briefly traded below its price on decentralized exchanges early Friday after robust selling pressure exceeded available liquidity in Orca and Raydium, prompting issuer Solstice Finance to step in with liquidity support.
WX post on Friday, PeckShieldAlert showed that USX briefly traded as low as $0.10 on secondary markets before rebounding, which was attributed to isolated trades during a period of extremely low liquidity.
Aggregated DEX data shows less extreme movement. The 15-minute USX/USD chart from the Orca Pool on GeckoTerminal shows the USX falling to around $0.80, reflecting where the highest trading volume occurred, before rebounding and stabilizing near $0.99 as liquidity returned.
Solstice he said began providing liquidity around 04:30 UTC, after which prices recovered towards steady-state levels, adding that it would continue to support secondary markets as needed. The company stated that USX reserves remained overcollateralized, that primary market redemptions were not affected and that it sought third-party certification to verify its collateralization.
The issuer stated that 1:1 redemptions remain available to authorized access institutional partners and that it is working with partners to deepen liquidity in the secondary market to limit the impact of similar events in the future.
Solstice added that eUSX positions or YieldVault products were not impacted by the volatility and that trades completed during this episode are final and buyers who purchased USX at lower prices are not liable for refunds.
Usx is a stablecoin from Solana, pegged to the dollar released by Solstice Finance. Estimates put its market capitalization at around $284 million data from CoinMarketCap at the time of writing.
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Potential risks facing stablecoins
The global stablecoin market has expanded rapidly since July, when the United States passed the GENIUS Act establishing a regulatory framework for dollar-pegged tokens. While banks, payments companies and crypto companies are rushing into the market, critics warn that the rapid growth of stablecoins could also introduce recent risks to financial stability.
In November, Dutch central bank governor Olaf Sleijpen said the European Central Bank may eventually have to treat stablecoins as a potential source of macroeconomic shocks, rather than just a regulatory issue, as dollar-pegged tokens become increasingly embedded in the financial system.
In an interview with the Financial Times, Sleijpen warned that stablecoin instability could force the rapid sale of reserve assets, amplifying market tensions and potentially impacting inflation, adding that immense enough shocks could prompt the ECB to rethink monetary policy.
On December 4, the International Monetary Fund, the global financial institution that monitors economic stability, released a report examining the rapid growth of the stablecoin market and how major jurisdictions, including the US, UK, Japan and the European Union, regulate it.
The IMF said that while recent rules could aid reduce macrofinancial risks, global supervision remains fragmented, warning that the spread of stablecoins across blockchains and exchanges could create interoperability challenges and cross-border frictions.
According to Defillama datastablecoin market capitalization is $308.5 billion, up from about $260 billion on July 18, when the GENIUS Act went into effect.
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