cryptobanking

✘The depeg situation on sUSD (algorithmic overcollateralized stablecoin) may seem similar to the crash that completely collapsed UST-LUNA but there are substantial differences.  

First of all, keep in mind that sUSD maintains the peg through supply/demand and is overcollateralized by SNX (now 200%, UST with LUNA 100%). sUSD would no longer be covered if SNX continues to fall.   

The downward pressure depends substantially on the market situation and the migration of staking to Pool420 (for the moment there are no more incentives to buy sUSD and burn debt).

In general, the situation is much more manageable than Terra because sUSD in circulation are about 60M compared to the 20B of UST. Synthetix treasury holds 50% of the debt (30M) + another 15M from LP, ETH, SNX and OP token.

Spartan Council and the Synthetix DAO are monitoring the situation without "manual" interventions that will be taken into consideration if SNX continues to fall and sUSD to depeg (buyback modules, burn, integrations, etc).

The 4 prices of money:

- Forex (Price vs. Other Monies)
- Interest rates (Time swaps of the asset)
- Price vs. Commodities (Price vs. stuff)
- Peg (Price vs. equivalents)

Crypto USD peg breaks are pretty much impossible to manage if the asset isn't backed by dollar-like assets, like short term bills or at least extremely liquid high quality assets.

It's kind of noteworthy sUSD got this far without peg breaking when it's only backing is SNX.

Yes, sUSD has been stable at $1 for years. Now there is this situation due to migration and staking system changes. There is not enough demand to bring sUSD back to the peg at the moment.