After UST/Luna, I think the next #stablecoin to collapse will be #sUSD which is over-collateralized by #SNX. Although sUSD is still comfortably over-collateralized, its peg mechanism has been dismantled over the last year (reducing then stopping SNX rewards, stopping liquidations, and forgiving users’ debt by consolidating it in a pool owned by the #Synthetix protocol). There is no risk of « death spiral » like with Luna as the debt repayment mechanism has been stopped but instead, I think sUSD will see a « slow bleed » which should lead to a similar outcome over a longer time period. Indeed, in the absence of a pegging mechanism the bet made by the Synthetix team is that the peg will be restored/maintained by market demand generated from yield opportunities and product usage. This seems like « magical thinking » to me. The rational for removing the peg mechanism was that sUSD could risk seeing a death spiral event although others suggest that #KainWarwick, the founder of Synthetix, had taken too much debt that he couldn’t repay which led him to push for a debt jubilee. However, like for all jubilees, someone has to pay the bill and here the ones to be slaughtered will be sUSD holders… #Crypto #DeFi #Stablecoins