Iron Bank Euro (ibEUR) Crash: The Uncertain Repegging Road Ahead

• Iron Bank Euro Stablecoin Faces Challenges in Value Recovery
• Lack of Immediate Path to Normal Price Levels
• Depreciation of ibEUR
• Waiting for Curve Pool to Stabilize

Iron Bank Euro Stablecoin Faces Challenges in Value Recovery

Iron Bank Euro (ibEUR), a smaller, alternative stablecoin, experienced a significant drop in value, losing up to 60% of its worth early on Monday. Sources close to the project revealed this sudden decline and the difficulties the stablecoin has faced in reclaiming its normal value. Initially valued at $0.97, ibEUR's value decreased to a low of $0.39 on Monday. This decline was the result of a major disruption in ibEUR's primary trading pool, which led to an imbalance in the asset's markets. Despite these challenges, by the time of press, ibEUR had managed to recover to a value of $0.72, thanks to the actions of risk-prone traders.

Lack of Immediate Path to Normal Price Levels

However, there is no certainty that ibEUR will return promptly to its former price levels. The currently supporting protocol is not undertaking any peg maintenance at this juncture. Furthermore, it is lacking the required treasury liquidity to stabilize the asset, as reported by the pseudonymous admin of the Keep3r Network Telegram chat, an entity affiliated with the project.

Depreciation of ibEUR

The depegging of ibEUR occurred following the withdrawal of nearly $900,000 in USDC liquidity by a single trader from the Curve Pool that facilitates most of ibEUR's trading. As of press time, the pool was somewhat biased in favor of ibEUR, indicating its insufficiency in the necessary USDC liquidity to maintain balanced trading.

Waiting for Curve Pool to Stabilize

In terms of ibEUR/USDC pool, we have to just wait and let curve pool do its thing, said the pseudonymous chat admin, known as Funk, in the Keep3r chat. He further suggested that the Iron Bank team should halt their credit borrowing contract, which currently has 2.5m ibEUR borrowed and seems to be farming single-sided on the pools, a move he describes as unwise. Funk has not responded to further requests for comments.

Edited by Jonathan Stoker