Real USD (USDR), a stablecoin primarily supported by real estate assets, has experienced a significant depegging event, resulting in a 50% price crash.
USDR, issued by TangibleDAO, previously boasted a market capitalization of around $45 million before it started a sharp descent. Described as “a new type of money backed by real estate, that yields 8-15% per year” on TangibleDAO’s website, the stablecoin was intended to offer stability through its real estate backing.
Stablecoins, such as USDR, are designed to provide a form of digital currency with increased reliability due to their pegging to traditional assets like fiat currency. However, they can depeg when investors lose confidence in the underlying assets supporting them.
It appears that USDR’s peg was compromised due to a flurry of redemptions, as indicated by a Dune analytics dashboard. The stablecoin’s collateral primarily consisted of a combination of illiquid assets like real estate and more liquid assets such as DAI. The redemptions appear to have entirely consumed the $11.8 million worth of DAI that was collateral for the stablecoin as of October 10, leaving primarily illiquid assets behind.
According to the dashboard, USDR is currently undercollateralized if the project’s native TNGBL token is excluded. However, if TNGBL tokens are included, the stablecoin boasts a collateralization ratio of 102%.
Notably, the stablecoin’s internal dashboard indicates that a segment of USDR is supported by… USDR itself, with 62,810 USDR listed as collateral for the stablecoin.
This occurrence underscores the significant risks connected to stablecoins and underscores the critical role of maintaining robust collateralization to uphold their stability and the trust of users.
