Crypto exchange platform Huobi’s stablecoin briefly decoupled from the US dollar due to liquidity problems.
The stablecoin, HUSD, fell as low as $0.87 before the liquidity crunch was resolved within hours and it was pegged back to the US dollar.
At the time of writing this, it is trading at $0.996, an 11% gain on the day.
According to a statement from the stablecoin, the issue was caused by the company’s decision to shut down certain accounts, including market maker accounts, in order to comply with regulations. HUSD says time difference in bank hours was the culprit.
“Recently we made the decision to close several accounts in certain regions to comply with regulatory requirements, including some market maker accounts. Due to the time difference in bank opening hours, this led to a short-term liquidity problem, which has now been resolved.”
The crypto exchange platform was quick to respond, saying it would work with the relevant authorities. coin issuers, Stable Universal Limited, are working together to address the liquidity issues blocking HUSD.
“We are aware of the recent liquidity issues related to the stablecoin HUSD, issued by Stable Universal Limited and based on the Ethereum network.
Huobi has always prioritized the safety of our customers’ assets and will work with the issuer of HUSD to find a solution and restore stability as soon as possible.”
