USDC Temporarily Depegs on Binance Amidst Crypto Market Sell-Off
Circle's USDC, a stablecoin pegged to the dollar, experienced unexpected volatility on the Binance exchange platform. It briefly depegged from its $1 value, falling as low as $0.76. This event occurred during a market-wide sell-off driven by skepticism surrounding the potential approval of a spot bitcoin ETF this month. Notably, USDC had three distinct price drops against its tether USDT trading pair on Binance between 12:10 and 12:21 UTC. The price hit lows of $0.76, $0.803, and $0.80 before quickly recovering back to its $1 peg each time.
Lack of Liquidity and Market Turbulence
The temporary depegging of USDC is likely due to a lack of sufficient liquidity when large sell orders were placed for USDC in exchange for USDT. The Binance 2% market depth for the USDC/USDT pair showed an imbalance towards the upside, suggesting that any sell order larger than the $6.1 million liquidity floor could push the price below its usual fluctuation of $0.98. The instability was also influenced by a $500 million liquidation in derivative positions following a report speculating on the SEC's rejection of various spot bitcoin ETF applications.
The Impact on USDC and the Crypto Market
USDC's volatility is significant considering its usual stability as a fiat currency-backed stablecoin, which is typically exchangeable at a 1:1 ratio with the US dollar. Drops in its value can have repercussions across the crypto market, affecting trust and perceived stability. However, this particular incident appears to be contained. It is worth noting that this is not the first time USDC has experienced a depeg; it previously traded down to $0.877 following the collapse of Silicon Valley Bank in March 2023, as a portion of its reserves were held at the troubled bank.
Binance was not the only exchange to experience a depegging of the USDC stablecoin. Okx also encountered a similar issue, albeit to a lesser extent, with USDC dropping to $0.955. Interestingly, the depegging on Okx started earlier than on Binance, beginning at 12:01 and persisting until 12:21 UTC, in contrast to the three snap-back recoveries observed on Binance's platform.
What stablecoin do you prefer? Share your thoughts and opinions about this subject in the comments section below.
Frequently Asked Questions
Can I have a gold ETF in a Roth IRA
Although a 401k plan might not provide this option, you should still consider other options like an Individual Retirement Account (IRA).
An IRA traditional allows both employees and employers to contribute. Another option is to invest in publicly traded corporations with an Employee Stockownership Plan (ESOP).
An ESOP can provide tax advantages, as employees are allowed to share in company stock and the profits generated by the business. The tax rate on money that is invested in an ESOP is lower than if it was held in the employees’ hands.
You can also get an Individual Retirement Annuity, or IRA. With an IRA, you make regular payments to yourself throughout your lifetime and receive income during retirement. Contributions to IRAs can be made without tax.
What is the cost of gold IRA fees
Six dollars per month is the fee for an Individual Retirement Account (IRA). This includes account maintenance and any investment costs.
If you wish to diversify your portfolio, you may need to pay additional fees. These fees can vary depending on which type of IRA account you choose. Some companies offer free check accounts, but charge monthly fee for IRA accounts.
Most providers also charge an annual management fee. These fees range from 0% to 1%. The average rate for a year is.25%. However, these rates are typically waived if you use a broker like TD Ameritrade.
How much should precious metals be included in your portfolio?
This question can only be answered if we first know what precious metals are. Precious metals are those elements that have an extremely high value relative to other commodities. This makes them highly valuable for both investment and trading. Gold is today the most popular precious metal.
There are many other precious metals, such as silver and platinum. While gold’s price fluctuates during economic turmoil, it tends to remain relatively stable. It is also not affected by inflation and depression.
In general, prices for precious metals tend increase with the overall marketplace. That said, they do not always move in lockstep with each other. When the economy is in trouble, for example, gold prices tend to rise while other precious metals fall. Investors are more likely to expect lower interest rates making bonds less attractive investments.
However, when an economy is strong, the reverse effect occurs. Investors favor safe assets like Treasury Bonds, and less precious metals. Since these are scarce, they become more expensive and decrease in value.
Therefore, to maximize profits from investing in precious metals, you must diversify across multiple precious metals. Additionally, since the prices of precious metals tend to rise and fall together, it’s best to invest in several different types of precious metals rather than just focusing on one type.
How much of your IRA should include precious metals?
It’s important to understand that precious metals aren’t only for wealthy people. You don’t need to be rich to make an investment in precious metals. There are many methods to make money off of silver and gold investments.
You might consider purchasing physical coins, such as bullion bars and rounds. It is possible to also purchase shares in companies that make precious metals. You might also want to use an IRA rollover program offered through your retirement plan provider.
Regardless of your choice, you’ll still benefit from owning precious metals. They offer the potential for long-term, sustainable growth even though they aren’t stocks.
And, unlike traditional investments, their prices tend to rise over time. If you decide to make a sale of your investment in the future, you will likely realize more profit than with traditional investments.
Statistics
- (Basically, if your GDP grows by 2%, you need miners to dig 2% more gold out of the ground every year to keep prices steady.) (smartasset.com)
- This is a 15% margin that has shown no stable direction of growth but fluctuates seemingly at random. (smartasset.com)
- Indeed, several financial advisers interviewed for this article suggest you invest 5 to 15 percent of your portfolio in gold, just in case. (aarp.org)
- If you take distributions before hitting 59.5, you’ll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
External Links
bbb.org
wsj.com
- Saddam Hussein’s InvasionHelped Uncage a Bear In 1991 – WSJ
- Want to Keep Gold in Your IRA at Home? It’s not exactly legal – WSJ
irs.gov
finance.yahoo.com
How To
Online buying gold and silver is the best way to purchase it.
To buy gold, you must first understand how it works. The precious metal gold is similar to platinum. It’s rare and often used to make money due its resistance and durability to corrosion. It’s hard to use, so most people prefer buying jewelry made out of it to actual bars of gold.
Two types of gold coins are available today: the legal tender type and the bullion type. Legal tender coins are minted for circulation in a country and usually include denominations like $1, $5, $10, etc.
Bullion coins are only minted to be used for investment purposes. Their value increases over time because of inflation.
They cannot be used in currency exchanges. For example, if a person buys $100 worth of gold, he/she gets 100 grams of gold with a value of $100. Each dollar spent by the buyer is worth 1 gram.
When looking to buy precious metals, the next thing you should be aware of is where it can be purchased. There are many options for buying gold directly from dealers. First, go to your local coin shop. Another option is to go through a reputable site like eBay. You can also purchase gold through private online sellers.
Private sellers are individuals who offer to sell gold at retail or wholesale prices. Private sellers charge a 10% to 15% commission per transaction. This means that you will get less back from a private seller than if you sell it through a coin shop or on eBay. However, this option is often a great choice when investing in gold since it gives you more control over the item’s price.
Another option for buying gold is to invest in physical gold. You can store physical gold much more easily than you can with paper certificates. However, it still needs to be safe. It is important to keep your physical gold safe in an impenetrable box such as a vault, safety deposit box or other secure container.
To purchase gold by yourself, you can visit a bank and a pawnshop. A bank can offer you a loan for the amount that you need to buy gold. These are small businesses that let customers borrow money against the items they bring to them. Banks typically charge higher interest rates than pawn shops.
You can also ask for help to purchase gold. Selling gold can be as easy as selling. Contact a company such as GoldMoney.com, and you can set up a simple account and start receiving payments immediately.
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By: David Sencil
Title: USDC Stablecoin Temporarily Depegs to $0.76 on Binance Amid Market Turbulence
Sourced From: news.bitcoin.com/usdc-stablecoin-temporarily-depegs-to-0-76-on-binance-amid-market-turbulence/
Published Date: Thu, 04 Jan 2024 14:30:31 +0000
