Altcoin project The stablecoin of the Waves ecosystem, Neutrino USD (USDN), slumped to $0.69, losing its $1 peg as WAVES saw a double-digit drop.
Why are the prices of these altcoin projects melting?
Neutrino USD (USDN) market cap nearly doubled to $850 million, but was later depreciated to close at $1. Market expert alias Duo Nine has this to say:
USDN started to sway on March 31st and is down almost 20% as of today. In the process, he deleted 200 million dollars. Considering the total circulating supply of USDN tokens is 1 billion (1 USDN is worth about 0.80 USD), this is a huge blow to USDN holders.
USDN 4-hour chart | Source: TradingView WAVES, a cryptocurrency offered as a reward for mining blocks on the open-source Waves Blockchain, fell 15% to $42. Users need WAVES keys in Neutrino smart contracts to mine USDN, while exchanging USDN has the opposite effect of destroying stablecoins to unlock the WAVES resource.
As we covered in the news of Kriptokoin.com, a few people on Twitter last week accused Waves of manipulating token prices through the DeFi lending platform Vires.finance. WAVES surged more than 200% in March, making it one of the best performing altcoin projects with a market cap of at least $1 billion.
Waves CEO Sasha Ivanov denied allegations that Alameda Research had manipulated Waves prices and ran a media campaign to trigger a sale. Alameda was founded by the CEO of crypto exchange FTX Sam Bankman-Fried. On Sunday, Ivanov presented a new management proposal that is said to curb speculative activity. The proposal states:
To prevent price manipulation and protect the ecosystem, I propose temporarily lowering the liquidation threshold to 0.1% for Waves and USDN borrowing. I also recommend limiting the maximum borrowing APR (percentage annual rate) to 40%.
Crypto Twitter backed the proposal, describing it as an attempt to disrupt the system for the benefit of insider trading. Meanwhile, Vires.finance is losing liquidity amid controversy. According to data source Defi Llama, the total value locked in the DeFi platform fell from a record $1.26 billion to $945 million in three days.
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