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- DAI’s median daily closing price, an Ethereum-based stablecoin backed by various assets, was 40 basis points higher than $1.00.
- Of all the stablecoins, it was discovered that GUSD has the highest resilience.
Research Analysis on Stablecoins
A Blockchain analytics company published research on stablecoins and their peg-robustness. It discovered that, throughout 2022, keeping practically any of the most popular stablecoins was more rewarding than holding genuine U.S. dollars. Based on volume-weighted price closing data going back to 2017, the research claims that the historical mean daily closing price for almost all leading stablecoins is slightly above $1.00.
DAI’s median daily closing price, an Ethereum-based stablecoin backed by various assets, was 40 basis points higher than $1.00. It had the highest premium among all stables, with USDP and TUSD trading at 35 and 33 basis point premiums, respectively. However, Tether (USDT), the biggest stablecoin by market cap, was the only coin consistently traded at a discount over time. Tether has also historically traded at a stunning 4 per cent less discount than its rivals. In contrast, USDC, its main rival, currently holds the record for the biggest premium at 4%.
Assessment of ‘Peg Robustness’
The paper also examines the historical price deviation trends of numerous stablecoins tied to the U.S. dollar. It assesses each coin’s “Peg Robustness”, or how far its market price deviates from $1.00 in the number of redemptions. Of all the stablecoins, it was discovered that GUSD has the highest resilience. This means its price is not subject to much downward fluctuation, even in the circumstances with high redemption rates.
Of all the stablecoins, USDT has the least resilience. That translates to a big price divergence from $1.00 compared to a modest amount of redemption flows. A stablecoin is a cryptocurrency that is intended to maintain a price peg to a generally stable underlying asset, according to the article. In addition to fiat money, they can also contain other financial assets and commodities like gold.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
