TrueUSD, the stablecoin linked to Tron founder Justin Sun, fell below its peg to the U.S. dollar late on Monday. 

The stablecoin fell as low as 1.3% below its peg to a low of $0.984, according to data from CoinMarketCap, and was trading at around $0.986 at the time of writing. 

Market participants observed a large volume of sell orders for TUSD on crypto exchange Binance on the last day, with net outflows crossing $56 million. 

Around the same time as $200 million TUSD was traded in for Tether-issued stablecoin USDT, a large buy order for the same amount of Bitcoin was placed on the exchange. This led some traders to speculate that Binance could be liquidating its entire corporate stash of TUSD.

On Jan. 10, Protos reported that TUSD experienced issues processing real time attestations of its reserves, potentially meaning that the stablecoin was undercollateralized. The team behind TUSD responded to the Protos report noting that the “balances ripcord” that was reported active had been accidentally triggered by reserve fund movements between banks, and had since been fixed. 

While there is no clarity on the reason for the depeg, X user Rho Rider drew attention to the lack of arbitrage traders capitalizing on the trading opportunity on crypto exchange Poloniex, where TUSD has been trading at an 8% discount for weeks.

“The obvious explanation is nobody can Deposit/Withdraw it to do the arbitrage,” Rho Rider noted, pointing to Telegram messages on the Poloniex group where users voiced their frustration on being unable to withdraw TUSD. 

Another theory for why the stablecoin had deviated away from the dollar peg was the fact that Binance hadn’t included TUSD in its MANTA launch pool.