As the market continues to mourn over losses on the Terra UST and LUNA debacle, DEI, a stablecoin used as a collateral mechanism for third-party devices constructed on the Fantom-based decentralized finance (DeFi) protocol DEUS Finance (DEUS), has failed to keep up its greenback peg, falling beneath 60 cents on Monday.
As the value of DEI hit an all-time low of $0.52, its market capitalization additionally adopted, dropping from virtually $100 million to round $52 million. However, regardless of the depegging of its stablecoin, DEUS Finance’s governance token, DEUS went up from $163.40 to $327.28, earlier than falling to $255.36.
At the time of writing, DEI’s value is $0.66 with a market capitalization of $59 million. This follows stablecoin fears caused by the UST and LUNA debacle and a choice by Deus Finance builders to pause DEI redemptions. However, in keeping with its official Telegram channel, the DEI peg will likely be restored within the subsequent 24 hours.
While DEI can also be an algorithmic stablecoin like UST, the DEI stablecoin is collateralized, that means that customers are in a position to mint 1 DEI by depositing collateral value 1 greenback. These might be property like USD Coin (USDC), Fantom (FTM), DAI, WBTC or DEUS.
Similar to UST, DEI’s peg is stabilized by a mechanism that entails the minting and burning of DEUS. When minting DEI, a DEUS collateral is burned until different tokens are used as collateral. On the opposite hand, when redeeming DEI, DEUS is minted.
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Back in March, the DeFi venture turned a sufferer of a hack that resulted in Dai (DAI) and Ether (ETH) losses value $3 million. Because of this, the platform determined to shut its DEI lending contract. A day after the Deus Finance exploit, DeFi protocols Agave and Hundred Finance additionally reported exploits that resulted in losses of varied cryptos that have been value a complete of $11 million.