USX, a Solana-native US dollar-pegged stablecoin, briefly traded below its peg on decentralized exchanges early Friday after heavy sell pressure overwhelmed available liquidity on Orca and Raydium, prompting issuer Solstice Finance to step in with liquidity support.
In an X post on Friday, PeckShieldAlert showed USX briefly trading as low as $0.10 in secondary markets before rebounding, a move attributed to isolated trades executed during a period of extremely thin liquidity.
Aggregated DEX data shows a less extreme move. A 15-minute USX/USD chart from GeckoTerminal’s Orca pool shows USX dipping to about $0.80, reflecting where most trading volume occurred, before recovering and stabilizing near $0.99 as liquidity returned.
Solstice said it began injecting liquidity about 04:30 UTC, after which prices rebounded toward the peg, adding that it would continue supporting secondary markets as needed. The company said USX’s reserves remained overcollateralized, that primary-market redemptions were unaffected and that it has requested a third-party attestation to verify its collateral.
The issuer said 1:1 redemptions remain available to institutional partners with permissioned access, and that it is working with partners to deepen secondary-market liquidity to reduce the impact of similar episodes in the future.
Solstice added that the volatility did not affect eUSX positions or its YieldVault products, and that trades executed during the episode are final, while buyers who purchased USX at lower prices are not required to return funds.
USX is a Solana-native, dollar-pegged stablecoin issued by Solstice Finance. It has a market cap of around $284 million, according to data from CoinMarketCap at the time of writing.
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The potential risk facing stablecoins
The global stablecoin market has expanded sharply since July, when the US passed the GENIUS Act to establish a regulatory framework for dollar-pegged tokens. While banks, payment companies and crypto-native companies have rushed to enter the market, critics warn that the rapid growth of stablecoins could also introduce new financial stability risks.
In November, Dutch central bank governor Olaf Sleijpen said that the European Central Bank may eventually need to treat stablecoins as a potential source of macroeconomic shocks, not just a regulatory concern, as dollar-pegged tokens grow more embedded in the financial system.
In an interview with the Financial Times, Sleijpen warned that instability in stablecoins could force rapid sales of reserve assets, amplifying stress across markets and potentially affecting inflation, adding that sufficiently large shocks could prompt the ECB to rethink monetary policy.
On Dec. 4, the International Monetary Fund, the global financial institution that monitors economic stability, released a report examining the rapid growth of the stablecoin market and how major jurisdictions, including the US, UK, Japan and the European Union, are regulating it.
The IMF said that while new rules could help mitigate macrofinancial risks, global oversight remains fragmented, warning that the spread of stablecoins across blockchains and exchanges could create interoperability challenges and cross-border frictions.
According to Defillama data, the stablecoin market cap is $308.5 billion, up from around $260 billion on July 18, when the GENIUS Act was signed into law.
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