Crypto analytics platform Kaiko claimed that USDT, the largest stablecoin by market capitalization, was decoupled in August.

A stablecoin becomes decoupled when it trades at a discount to the fiat currency or asset it reflects.

Kaiko data shows that USDT’s decoupling severity reached 98% at 8:00 AM UTC on August 7, meaning the stablecoin was trading at a discount on almost every platform.

However, decoupling has not received much attention because it is not as important or dramatic as previous events.

Kaiko said the unpegging in August came after a rapid net sell-off of USDT worth $500 million in a few days across Binance, Huobi, and Uniswap.

Historically, USDT has repeatedly decoupled for a variety of reasons, such as redemption fees, reduced liquidity, and minimum requirements set by issuer Tether Holdings.

However, Kaiko stressed that continued discounting could undermine trust in the world’s largest stablecoin.

Kaiko suggested that the decoupling problem could be solved by eliminating redemption fees, thereby reducing costs and reducing the supply of stablecoins.

Despite revenues of $850 million in the second quarter of 2023, analysts claim the change will not have a significant impact on profits.

Kaiko’s report comes a few months after USDT experienced a minor, brief decoupling in June, falling to $0.997. #Kaiko  #USDT