Deus Finance’s stablecoin DEI lost its peg to the US dollar on Monday, dropping to as low as $0.54 following market instability in the stablecoin asset class.
The depeg started when DEI lost 20 cents on Sunday night as traders exchanged DEI tokens for USDC when the liquidity on exchanges dropped. As prices dropped, more traders liquidated their DEI for other assets to mitigate risks.
DEI has a market capitalization of $62 million and is based on the Deus platform, a DeFi on Fantom. The token is made up of 10% DEUS tokens and 90% of other stablecoins.
The collateral ratio of DEI is constantly checked and adjusted through arbitrage bots, which constantly exchange $1 of the underlying tokens for 1 DEI.
Algorithmic stablecoin is set to automatically peg to the price of another currency, different from centralized alternatives supported by fiat currencies kept in bank accounts.
Source: Coindesk
