World’s biggest stablecoin regains dollar peg after $3 billion in withdrawals

World’s biggest stablecoin regains dollar peg after $3 billion in withdrawals

, the world's largest stablecoin, regained its peg to the after more than $3 billion worth of tokens left the system in a single day. The cryptocurrency — which is meant to always be worth $1 — on Thursday and struggled to climb back to its intended dollar peg. By Friday, tether was trading firmly at $1 again, soothing investors' fears about a possible crypto market contagion from the collapse of embattled stablecoin project Terra. , or UST, is different to tether in that it relies on a complex mix of code and a sister token called luna to stabilize its price. It was also partly collateralized by of bitcoin. Tether, on the other hand, is supposed to be backed by cash, short-term debt obligations corresponding to an equivalent amount of dollars deposited by its users. Those assets are held in a reserve managed by a company of the same name. It's essentially like a bank account for crypto investors, who often turn to tether in times of heightened market volatility. Much bitcoin trading is done in tether. Tether now has a circulating supply of around $79.5 billion, down from $82.9 billion 24 hours earlier. suggesting the company behind it