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Depeg

A depeg occurs when an asset designed to track a reference value moves meaningfully away from that target. For example, a stablecoin intended to trade around $1 would be depegging if its market price moved materially away from $1.

Why it matters to you

A depeg can indicate concerns about reserves, redemption, liquidity, market confidence or the mechanism used to maintain the token's value. Not every temporary deviation results in permanent failure, but a stablecoin's ability to maintain or restore its peg is fundamental to its usefulness as digital money.

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