TUSD Depegs, but to Over $1 for a Change

Relatively unknown stablecoin TUSD lost its dollar peg Monday, hitting a high of $1.20 relative to USDT

May 2, 2023 05:02 pm

WindAwake/Shutterstock modified by Blockworks

TrueUSD (TUSD) is quickly climbing the stablecoin dominance charts, thanks to Binance.

In top stablecoins by market capitalization, TUSD is now ranked number 29. The token’s market capitalization increased from around $755 million at the end of 2022 to $2.4 billion on Monday.

The stablecoin, which was relatively unknown until recently when Binance made BTC-TUSD a zero-fee trading pair, lost its dollar peg Monday, hitting a high of $1.20 relative to USDT on Binance.

Newsletter

Subscribe to The Breakdown

Binance’s BTC-TUSD pair is now one of the highest-volume trades in the entire industry, researchers from Kaiko said.

“TUSD liquidity has not kept pace with its volumes, making a depegging like this more likely,” Kaiko analysts added.

Monday’s TUSD depeg coincided with a number of users on Aave and Compound borrowing large amounts of the token, apparently with organic transactions, Kaiko said.

“The most common strategy was borrowing TUSD and swapping for USDC, effectively shorting TUSD from its elevated price,” analysts added. “However, neither Aave nor Compound have a large supply of TUSD, which meant that borrowing rates quickly surged, hitting over 100% APR on both protocols.”

The move also coincided with Tron founder Justin Sun depositing over $50 million worth of TUSD on Binance, spurring speculation that Sun was trying to farm the SUI liquidity pools on Binance, which requires users to stake TUSD or BNB. Binance CEO Changpeng “CZ” Zhao threatened Sun with legal action, and Sun then admitted someone on his team was using a portion of the funds to farm, but most were to be used for market making TUSD on the exchange.

“Looking at market depth for the TUSD-USDT pair on Binance, someone has been adding liquidity in massive size: the pair is now the most liquid pair on Binance after a huge $200mn injection of orderbook liquidity at the 1% level,” Kaiko added.

With increased depth and surging demand — thanks, SUI launchpad — TUSD is securing its spot as a top player in the stablecoin landscape.

Get the news in your inbox. Explore Blockworks newsletters:

The Breakdown: Decoding crypto and the markets. Daily.
0xResearch: Alpha in your inbox. Think like an analyst.

Tags

Newsletter

The Breakdown

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Digital Asset Summit 2026

Javits Center North | 445 11th Ave

Tues - Thurs, March 24 - 26, 2026

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

buy tickets learn more

recent research

Research

Solana DEX Winners: All About Order Flow

Solana's spot trading landscape will remain bifurcated: prop AMMs will own the short-tail of highly liquid pairs, while passive AMMs continue drifting toward the long-tail. Both can win via vertical integration, but in opposite directions: passive AMMs are moving closer to users through token issuance platforms (e.g., Pump-PumpSwap, MetaDAO-Futarchy AMM), while prop AMMs are moving down the stack into transaction landing services and infrastructure (e.g., HumidiFi-Nozomi). The venues most at risk are legacy AMMs with limited end-user control and no durable, launch-driven source of order flow.

by Carlos Gonzalez Campo