- USDR, a real estate-backed Polygon stablecoin, faces a sharp 40% depegging event.
- Depletion of DAI reserves triggers a crisis, leading to plummeting USDR value.
- Cautionary tale warns against high-yield opportunities in the crypto market.
Real USD (USDR), the Polygon-based stablecoin backed by tokenized real estate, experienced a sudden depegging event. In detail, the asset fell dramatically by approximately 40% in mere minutes.
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Developed by TangibleDAO, USDR stands as the world’s first stablecoin with its value accrual system integrated into its design, offering a unique approach compared to other digital currencies. Operating on the Polygon blockchain, USDR is designed to be collateralized by yield-producing real estate assets.
The depeg event unfolded after a day marked by growing concerns. USDR’s value dipped below its peg due to depleted DAI reserves, inciting a basic bank run on the system. In mere minutes, the stablecoin plummeted to $0.60 and further to $0.51 as of 11:52 am EST.
The exact cause of the depleted DAI reserves remains unclear, and DAI is typically redeemable at a 1:1 ratio with USDR. Advisors have recommended USDR holders to exit their positions due to the absence of DAI backing, with the remaining assets comprised of illiquid real estate and insurance funds. A mere 7 million USDR holds immediate exit liquidity for the 67 million USDR in circulation.
Additionally, the collateralization status of USDR raises concerns when excluding the project’s native TNGBL token, as the DUNE dashboard indicates. However, including this token shows a collateralization ratio of 102%.
Intriguingly, USDR’s dashboard discloses that some of the USDR is backed by itself, a questionable practice. It lists 62,810 USDR as collateral for the stablecoin, raising concerns. While USDR once offered high APRs, some as tempting as 20%, the abrupt depegging serves as a reminder of the significant risks involved in high-yield ventures.
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