USDN depegging quickly

Hi there!

Could someone explain USDN mechanism against depegging? Is the USDN well prepared for this? I learned that the USDN is backed by WAVES but I’m not sure if that’s true. What are your thoughts?
What could possibly happen if WAVES is falling too? Is it the same story as in LUNA and UST?

It’s backed but redeeming it requires an insane amount of locked NSBT, keeping regular arb traders like myself from being able to help burn USDN and restore the peg. I would imagine they are going to change the mechanism soon as many people have spoken against it, and the situation right now speaks for itself as far as that goes.

Is it true stablecoin if it loses 15% daily? USDN seems to be crashing now. It’s almost worth 0.8 USD. Where can I read about USDN backing algorithm ?

It’s backed by WAVES token reserves in a smart contract. it can be minted using WAVES or burned and receiving WAVES in return.

It used to be able to be redeemed by anyone for any amount, but now the redemption process has been kneecapped and is basically useless for the average trader or anyone wanted to try and arb the price back down.

Mechanism for redemption needs to be overhauled or reverted so the free market can participate in it, to keep the peg stable.

Thanks for your answer. I think the USDN is doomed. It’s now worth only 0.73. It’s game over of the whole system.