In early August 2025, Tether’s USDT experienced slight depegging across major decentralized exchanges due to intensified selling pressure. Data from platforms like Curve and Uniswap V3 revealed unusual imbalances in stablecoin liquidity pools, sparking speculation about market manipulation and competitive dynamics within the stablecoin ecosystem.
Unusual Activity in Major Liquidity Pools
On Curve Finance’s 3pool, which combines USDT, USDC, and DAI, the proportion of USDT surged to approximately 60%, far exceeding its typical one-third allocation. Meanwhile, both USDC and DAI holdings dropped to around 20% each, signaling a significant shift in market behavior.
This imbalance suggests heavy selling of USDT against other stablecoins, likely driven by arbitrageurs or large entities capitalizing on price discrepancies. The 3pool is designed to maintain near-equal balances among its three assets for optimal efficiency — deviations like this can strain the system and increase slippage for traders.
Similarly, on Uniswap V3, the USDT-USDC pool — one of the most liquid stablecoin pairs — showed a stark imbalance. With $102.3 million worth of USDT** compared to just **$9.46 million in USDC, the pool reflects strong demand to offload USDT in favor of USDC.
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According to CoinMarketCap, USDT dipped slightly below its $1 peg during this period, trading at **$0.9991** at the time of writing. While such minor fluctuations are not uncommon, the coordinated nature of the outflows raised eyebrows across the crypto community.
Tether CTO Points Finger at Market Players
Paolo Ardoino, CTO of Tether, took to social media to comment on the situation with clear implications about potential foul play. In a now-viral tweet thread, he questioned why USDC — traditionally seen as a primary beneficiary when USDT faces pressure — was simultaneously undergoing heavy redemptions.
"Isn't it interesting that USDt is being pressured down (slightly, within 10bps, just to push market makers to react), and USDc, the main competitor that you would expect being gaining from the situation, is redeemed heavily nevertheless, while suddenly a competitor born 2 days…"
— Paolo Ardoino 🍐 (@paoloardoino) August 3, 2023
The reference to a “competitor born two days ago” was widely interpreted as a jab at FDUSD, a new stablecoin launched by Binance and quickly listed on its platform. Though FDUSD had not yet gained significant traction, its sudden emergence amid USDT’s volatility fueled conspiracy theories.
Ardoino further mocked those dismissing the scenario as normal market activity:
“Yep! Everything is perfectly normal. No market manipulation here 🧐”
His tone underscored growing tension between Tether and certain centralized exchanges perceived to be leveraging their scale to influence stablecoin dynamics.
Chain Analysis Fuels Binance Conspiracy Theory
Adding fuel to the fire, Adam Cochran, partner at Cinneamhain Ventures and a known critic of Binance, published on-chain evidence suggesting that addresses dumping large amounts of USDT originated from Binance’s ecosystem.
Cochran traced several wallets actively swapping USDT for DAI back to funding sources linked directly to Binance. One key address received thousands of ETH directly from Binance cold storage, forming what he described as “a long chain of addresses interacting with USDT over the past year.”
"The address that's mass swapping USDT -> DAI is Binance funded and has multiple addresses bulk selling USDT."
— Adam Cochran (@adamscochran), August 3, 2023
He argued that this wasn’t random trading but part of a strategic campaign:
- Weaken USDT by creating artificial selling pressure.
- Undermine USDC through coordinated redemptions, reducing confidence and market share.
- Accumulate DAI — potentially for future use in an algorithmic stablecoin project previously hinted at by Binance CEO Changpeng Zhao (CZ).
Furthermore, Cochran alleged that Binance could be boosting FDUSD by offering zero-fee trading and launchpool incentives, artificially inflating volume and adoption while undermining rivals.
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Core Keywords Identified
- USDT depeg
- Tether CTO Paolo Ardoino
- stablecoin market manipulation
- Binance FDUSD
- Curve 3pool imbalance
- Uniswap V3 liquidity
- on-chain analysis
- USDC redemption
These keywords naturally reflect user search intent around market anomalies, trust in stablecoins, and power dynamics among major crypto players.
Frequently Asked Questions
Why did USDT lose its $1 peg temporarily?
USDT experienced minor depegging due to concentrated selling on decentralized exchanges like Curve and Uniswap. While still within a 10 basis point range ($0.9991), this was likely triggered by large-scale trades originating from exchange-controlled wallets aiming to exploit arbitrage opportunities or influence market perception.
Is there proof that Binance manipulated the stablecoin market?
There is no definitive legal proof, but on-chain analyst Adam Cochran presented compelling evidence linking bulk USDT sellers to Binance-funded addresses. Combined with strategic promotion of FDUSD and CZ’s prior statements about launching an algorithmic stablecoin, many in the community view this as circumstantial evidence of coordinated action.
What role does DAI play in this scenario?
DAI appears to be a strategic accumulation target. By buying DAI during periods of USDT/USDC instability, an entity could build reserves to back a future algorithmic or hybrid stablecoin — giving them greater control over supply, collateralization, and governance.
How do liquidity pools react to stablecoin imbalances?
Imbalanced pools like Curve’s 3pool suffer from reduced capital efficiency and increased slippage. When one asset dominates (e.g., 60% USDT), traders face worse rates when swapping into or out of that asset, potentially triggering further arbitrage or withdrawal cascades.
Could FDUSD replace major stablecoins?
Currently, FDUSD lacks the scale and transparency of USDT or USDC. However, with Binance’s massive user base and promotional tools (zero fees, staking rewards), it could gain traction — especially if used as a vehicle to challenge incumbent stablecoins.
Are minor depegs dangerous for the crypto economy?
Short-term depegs within 1% are common and usually self-correcting. However, repeated or coordinated attacks may erode trust in dollar-pegged assets, especially if users perceive centralization risks or exchange-driven manipulation.
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Conclusion
The August 2025 episode of USDT depegging highlights the fragile equilibrium underpinning stablecoin markets. While Tether maintains strong reserves and rapid response mechanisms via its buyback policy, coordinated actions — whether real or perceived — can create ripple effects across DeFi protocols.
With major exchanges holding vast capital reserves and influence over listing, trading incentives, and user behavior, questions about fair competition and market integrity remain urgent. As new entrants like FDUSD emerge, transparency and on-chain scrutiny will be critical in preserving trust.
Ultimately, events like these serve as stress tests — not just for stablecoins themselves, but for the broader ecosystem’s resilience against centralized power plays disguised as organic market movements.