Key Facts
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On June 15, 2023, USDT briefly traded slightly below its $1 target on some decentralized exchanges, showing a small but noticeable deviation.
In an AMM pool, price is a function of reserves. When one asset dominates the reserves, traders face worse pricing to exit it, and the pool can “quote” a discount for that asset.
The move was linked to an imbalance in Curve’s 3Pool (USDT/USDC/DAI), where USDT became heavily over-represented as traders swapped out of USDT into other stables.
At the peak of the imbalance, USDT’s share in the 3Pool rose far above the roughly one‑third “balanced” state, creating price pressure in that pool.
Summary
The price dip described in the report was around 0.3%, with USDT quoted near $0.997 on certain venues—enough to create arbitrage opportunities across platforms.
Arbitrage behavior typically means buying USDT where it is discounted and selling where it is closer to $1, helping the price converge but amplifying short-term flow.
What Happened
Why It Mattered
The report links part of the pool shift to large on-chain borrowing and swapping activity, described as whale-sized flows that changed pool composition quickly.
How Pools Shift
Market reaction included a broad risk-off move and weaker sentiment, with large-cap crypto prices falling over the following 24 hours in the narrative.
How Arbitrage Works
Tether’s CTO Paolo Ardoino stated there was no reason to panic and that Tether was ready to redeem buybacks at $1, framing the issue as temporary and tied to DEX pool mechanics.
