Anchor (ANC) is down 70% in one day, having declined from $0.85 to $0.20
Anchor Protocol (ANC) has dropped in price by more than 70% in the past day due to a sharp drop in overall deposits on the protocol and stablecoin TerraUSD (UST) failing to meet its dollar rate.
Anchor Protocol (ANC) plunges 70% amid worsening UST and Luna crisis
ANC/USD 4-hour chart | Source: TradingView
ANC fell from $0.85 to $0.20. Analysts say that UST’s ongoing price decoupling from the US dollar may have contributed to the massive sell-off of ANC, as Anchor relies on UST for its operations. The algorithmic stablecoin is currently trading at around $0.3 – a roughly 70% deviation from its supposed dollar value.
The crisis surrounding UST’s dollar peg has seen users make large withdrawals from Anchor. These users can rush to withdraw their UST deposits to no longer be exposed to volatile stablecoins.
As UST accounts for the majority of deposits on the flagship Anchor’s Earn product, the value of Anchor’s deposited assets has dropped significantly since last Friday, from UST 14 billion to UST 3.7 billion. That is partly due to both the withdrawal and the drop in the price of the UST.
The ANC has suffered the same fate as LUNA, Terra’s primary asset to maintain its peg. It went from $30 to $2, down 93% today.
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