What does the market decline despite an increase in value of Justin Sun’s stablecoin USDD signify?
In recent months, the market value of stablecoins has been declining rapidly, following the collapse of Terra by Do Kwon and the leading trading board FTX by Sam Bankman-Fried. Many investors have abandoned the crypto industry, causing a significant impact on almost all stablecoins.
Binance USD, or BUSD, issued by Paxos, has been severely affected, with its market value dropping from $22 billion to $10 billion in the past three months. However, the recent strange rise in USDD, a stablecoin controlled by Justin Sun, has seen its market value increase to over $750 million today. Although it has not been audited by Armanino, the leading audit firm, it has raised many analysts’ concerns.
Both Frax and BUSD, which were the market leaders in the past, have suffered significant losses of up to 60%. Even major stablecoin issuers, such as Tether and USDC, have also seen their market values decline by 15-25%.
JUST Stablecoin (USDJ) and USDD are the only stablecoins that have not been affected or have seen their value increase. They are under Sun’s control, and he has been able to maintain their value during the market downturn.
Armanino, the chosen auditor for FTX and other crypto companies, has failed to provide certification for USDD since December 2022. This was after the stablecoin issuer was bought by a group of Asian companies, with links to Justin Sun, in April 2021.
TrustToken has now removed the Armanino brand from its website, causing Armanino to announce that it would no longer offer its services to TrustToken (TUSD). This is seen as a significant blow to the auditing firm, as TrustToken is one of the leading issuers of stablecoins globally.
The declining market value of stablecoins is a matter of concern for investors in the crypto industry. The volatility of the market, coupled with the lack of regulation, has made it difficult to predict stablecoins’ future. As a result, investors are now more cautious and demanding more transparency and regulation from the industry.
- Justin Sun Confident In Huobi’s Future As Hong Kong’s VASP License Approaches
- Justin Sun: Huobi Global Secures Crypto Trading License In Hong Kong