Waves have fallen by more than 96% and Neutrino USD (USDN) FUD
Waves have fallen by more than 96% from their peak, and Neutrino USD (USDN) FUD
Neutrino USD (USDN), a stablecoin in the Waves ecosystem, has lost its peg and is now trading at $0.86. What could be going on?
Waves is a blockchain platform that can be used for many things, such as smart contracts and decentralized applications (DApps). When the Russia-Ukraine conflict began on February 24, 2022, the Waves price surged from $10 to $63—a more than 600% gain in just one month—because the project belonged to the Ukrainian-born scientist Alexander Ivanov (also known as Sasha Ivanov).
Four Factors depend on waves surged more than 600% in just a month
- Waves 2.0 and 2022 roadmap
- Creation of Wave Labs and $150 million fund
- Increase in popularity of Neutrino’s stablecoin
- Confusion around Waves’ connection to Russia and Ukraine
Currently, the token price has dropped from a high of $63 on March 31, 2022, to a $2 price today, indicating a massive pump and dump of this project.
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So Why Waves Dumping?
Recently, on December 8, the Digital Asset eXchange Association (DAXA), which consists of the five major Korean crypto exchanges, issued a warning because the Algoritham stablecoin USDN, which is backed by WAVES, lost its $1 peg and hasn’t regained it in more than five months; the price of the USDN stable coin is around 0.88, which is not equal to the US dollar rate.
Upbit Exchange said “We hereby announce that WAVES(Waves) has been flagged with Investment Warning by Digital Asset eXchange Association(DAXA). DAXA may jointly take measures such as urging investment caution/caution, flagging of investment warning, and termination of market support for investor protection.”
The South Korean exchange will do a thorough review, and if it can’t figure out why there is an investment warning, it might take the token off the market.
The price of a Waves token has dropped by more than 16% in the last few days. The USDN is backed by the Waves token.
Neutrino USD (USDN) is next UST?
The crypto market is stuck because people are afraid that yet another algorithmically pegged stablecoin will fail. The Waves ecosystem’s stablecoin, USDN, is trading at around $0.88, which is less than its $1 peg.
The Neutrio USD (USDN) was 16% below the peg on December 8
So, what exactly is a USDN, as opposed to a USDT? Is there another Luna event? So, here’s the blog post to allay your fears; let’s get started.
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When Upbit and Bithumb nofie users worry about the Neutrino USD (USDN) depeg associated with waves, there is a lot of panic, but the company is sending out a message to the wave community to clear up the current misunderstanding situation, which is directly affecting the token price.
“According to their statement, Upbit and Bithumb believe that WAVES price could become volatile due to USDN depeg. However, USDN is a separate project built on Waves blockchain that uses WAVES as collateral; it is not intrinsically linked to WAVES token. There is only one way in which USDN can directly affect WAVES price – through redeeming WAVES from the contract and selling WAVES on the market.” in blog post
They said that only 4.2% of all WAVES are held in the Neutrino smart contract and that Neutrino USD has nothing to do with the creation of WAVES and can’t make the number of WAVES go up.
“It is impossible to drain the entire reserves due to the daily swap limits set on Neutrino and backing rate protections” in blog post
For these reasons, the company is confident that the concerns about WAVES tokens are unfounded. The company is also in contact with Upbit and Bithumb, which have yet to clarify the misunderstood link between WAVES and USDN.
In last “we remain fully committed to upholding complete transparency with you, our community, throughout this process.”
Wrapping Up
Waves is not identical to Luna because Terra Luna is only linked to the UST stable coin and has no other uses, whereas Waves is a protocol token used for Dapps and smart contracts. Also USDN is not fully linked with waves as per company statement.
