This week’s on-chain data report by the analytics company Glassnode looks into three major events — the depegging of the USDC stablecoin, net capital outflows and futures open interest data.

This has caused USDC and DAI to trade at lower values of $0.88 and $0.89 respectively. DAI’s value drop is because it is backed by stablecoin collateral of only about 65.7%. Gemini’s GUSD and Paxos’ USDP also dipped below their $1 peg, while BUSD and Tether traded at a premium.

Tether, in particular, traded at a premium between $1.01 and $1.03 during the weekend, which is ironic because it is seen as a safe haven in the face of potential risks in the heavily regulated US banking sector. This is the first time since the LUNA-UST project collapse that there has been volatility in stablecoin prices.

DAI / USDC

Stablecoins, particularly USDC, have become the primary form of collateral supporting DAI. This trend has been consistent since mid-2020, with USDC making up around 55.5% of direct collateral and a significant portion of Uniswap liquidity positions, totaling to about 63% of all collateral.

According to Glassnode data, dependence on stablecoins for collateral raises questions about the decentralized nature of DAI. This recent event highlights how DAI’s price is closely tied to the traditional banking system due to its collateral mix, which also includes 12.4% in tokenized real-world assets.