Synthetix USD (sUSD), the decentralized stablecoin backed by the Synthetix protocol, has sunk to fresh lows, sliding beneath $0.70 as it struggles to maintain its peg to the US dollar.
Despite the decline, the team behind Synthetix emphasized that this isn’t unfamiliar territory. “Both Synthetix and sUSD have previously endured tough market conditions and volatility in the stablecoin space — this is yet another test of durability,” a representative said.
sUSD Falls Nearly 31% Below Its Peg
sUSD is supported by crypto collateral — users must lock up SNX tokens to mint it. This means its peg stability is tightly tied to SNX’s market performance.
Currently, sUSD is trading at $0.70, reflecting a sharp 30% drop from its intended 1:1 dollar value, according to data from CoinMarketCap.
Interestingly, the SNX token itself has remained relatively steady during the same timeframe, falling only around 1% over the past seven days and sitting at $0.63. However, on a 30-day basis, SNX is down about 26%, mirroring broader market weaknesses.
The Synthetix team attributes sUSD’s price swings to “structural changes” brought by SIP-420 — a recent proposal that moves debt risk from individual stakers to the protocol level.
To address the volatility, Synthetix has outlined several action plans:
- Short-Term: Boosting sUSD liquidity through Curve pools and incentives on Infinex, its derivatives trading platform.
- Mid-Term: Rolling out a simplified, debt-free SNX staking system to encourage repaying outstanding debts.
- Long-Term: Implementing major changes to capital efficiency via the 420 Pool, protocol-level sUSD supply management, and new mechanisms to promote adoption across the ecosystem.
Synthetix founder Kain Warwick took to X on April 2 to clarify that the dip is largely due to the removal of sUSD’s primary demand source. “We’re in a transition phase — new tools are being deployed, and with that comes temporary volatility,” he noted.
He also reminded users that sUSD is not an algorithmic stablecoin, but one backed by crypto assets, meaning price deviations are possible. “The peg does drift, but we’ve built-in mechanisms to restore it when necessary,” he said.
The stablecoin has faced ongoing instability since early 2025. It fell to $0.96 on January 1, briefly climbed back to $0.99 in February, and has fluctuated since before finding some stability in March — now once again losing ground.
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