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Trader swaps 131K stablecoins for $0 during USDR depeg
An attempt to withdraw USDR stablecoins amid a liquidity crunch appears to have gone horribly wrong
During the crisis on Oct. 11 involving real-estate-backed U.S. dollar stablecoin Real USD (USDR), a trader appears to have swapped 131,350 USDR for 0 USD Coin, resulting in a complete loss on investment.
According to the Oct. 12 report by blockchain analytics firm Lookonchain, the swap occurred on the BNB Chain through the decentralized exchange (DEX) OpenOcean, at a time when USDR depegged from par value by nearly 50% due to a liquidity crunch. A maximal extractable value (MEV) bot subsequently picked up the discrepancy, netting a total of $107,002 in profits through an arbitrage trade.
During periods of poor liquidity, slippage on DEXs can reach as high as 100%. In September 2022, Cointelegraph reported that a trader attempted to sell $1.8 million in Compound USD (cUSDC) through Uniswap v2 and only received $500 worth of assets in return. In this instance, another MEV performed an arbitrage trade before its over $1 million in profits were hacked just hours later.
On Oct. 11, USDR depegged after users requested over 10 million stablecoins in redemptions. Despite being 100% backed, less than 15% of its then $45 million in assets were backed by liquid TNGBL tokens, with the remaining backed by illiquid tokenized real-estate assets.
As explained by analyst Tom Wan, the tokenized assets were minted on the ERC-721 standard, which could not be fractionalized to create liquidity for investor redemptions. In addition, the underlying homes could not be immediately sold to meet investors’ withdrawal requests. Altogether, the Real USD treasury could not meet the redemptions, leading to a collapse in investors’ confidence.
*Source: Cointelegraph What is blockchain technology?
Blockchain is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network. Virtually anything of value can be tracked and traded on a blockchain network, reducing the risk and cutting costs for all involved. Unlike a typical digital database, blockchain stores data in blocks that are then chained together. As new data comes in, it is entered in a fresh block. Once the block is filled with data, it is chained to the previous block, which then chains the data in a chronological order. Blockchain’s most common use so far has been as a ledger for transactions. In the case of cryptocurrencies, blockchain is used in a decentralised way so that no single person or group has control over it and, instead, all users can retain control collectively. Decentralised blockchains are immutable, which means data once entered is irreversible. In the case of cryptocurrencies, this means transactions are recorded permanently and can be viewed by anyone.
#ContentStar##HotTopicDiscussion##GateLive# The US Bureau of Labor Statistics (BLS)’s September consumer price index (CPI) report showed that the headline inflation rate sat at 3.7% in September, surpassing the consensus estimates of 3.6%. Core CPI matched expectations with a year-over-year increase of 4.1%, down from the 4.3% reported in August.
Annual Inflation Rate Unchanged From August, Core CPI Matches Expectations
The new CPI data released on Thursday revealed that the annual inflation rate in the US rose to 3.7% in September, exceeding economists’ expectations of a 3.6% increase. The figure means the annual CPI remained unchanged from the August rate.
On a monthly basis, inflation rose by 0.4%. This compares to a monthly change of 0.6% in the August CPI report and economists’ projections of a 0.3% rise.
Annual Core CPI, a key metric of inflation that excludes volatile food and energy prices, stood at 4.1%, matching the projected 4.1% and slightly down from the earlier 4.3% rise. Monthly, core CPI climbed by 0.3%, also in line with what economists projected and the earlier core CPI reading.
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In the wake of the report, the financial markets reacted with the S&P 500 futures trimming their premarket gains to 4,427. The Dow Jones Industrial Average (DJIA) opened rose to 34,153 in the market pre-open before retreating to 34,135.
The tech-oriented Nasdaq 100 stood at 15,431, down from 15,448 earlier in the premarket. The 10-year US Treasury yield sat at 4.60%, slightly falling to 4.71%.
In the foreign exchange market, the US dollar gained about 0.2% against the Japanese yen to 149.4 and over 0.4% versus the euro. The British pound sterling slipped 0.45% against the greenback to 1.22.
The latest CPI report once again highlighted that inflationary pressures are notably tough to tame, with the annual rate standing at the same level where it was a month ago despite record-high interest rates. Last week, the Federal Reserve officials said there may be no need for further hikes this year. However, it would be no surprise if this report, coupled with the recent red-hot jobs data, stimulates the central bank to deliver another quarter-point increase before the end of the year.
#ContentStar# #BountyCreator# #GateioBountyCreator# #NewsMessenger# #GateLive# #contentstar# #HotTopicDiscussion# 
