- Fantom’s (FTM-USD) FTM crypto is one of the top performers across the industry today
- The coin is seeing a price surge thanks to speculation about the return of a prominent developer
- Fantom, like many other networks, was affected by turbulence across the stablecoin industry this month
Source: shutterstock.com/ARTEMENKO VALENTYN
Fantom is one of many networks that have been adversely affected by recent volatility in the stablecoin industry. FTM had been going through plenty of trouble to get its own stablecoin off the ground, so the TerraUSD (UST-USD) crash only set it back even further. However, news of a renowned Fantom developer’s potential return to the industry is getting users excited again, lifting up FTM crypto prices in response.
Fantom is a layer-1 dapp platform. Like others, it’s looking to exercise dominance over the industry as Ethereum (ETH-USD) gas fees and transaction throughput continue to lag. Since launching in late 2019, developers have done well to attract over 200 dapps to the platform. Fantom has also integrated Ethereum Virtual Machine (EVM) on the network, allowing Ethereum developers to easily launch dapps simultaneously on Fantom.
Still, one thing Fantom is having trouble with is its stablecoin offering, Fantom USD (FUSD-USD). Founded in early 2022, FUSD is a $1-pegged token which holds its peg thanks to a reserve of FTM crypto. Since it requires users to mint FUSD at a collateral ratio of 500%, this means FUSD is actually an “over-collateralized stablecoin.” This in turn suggests the crypto may be a very safe option as a stablecoin.
However, as its journey has proven so far, that’s not the case. And things only seem to be getting worse.
FTM Crypto Booms on Word That Popular Developer Could Return to Help Stabilize FUSD
Since its launch, FUSD has been unsuccessful in actually reaching its $1 peg. Rather, the token has been floating up and down in price throughout its first few months of existence. As a key to the network’s DeFi platform, this instability is a massive hamper to Fantom DeFi developers as well as the FTM crypto.
The recent de-pegging of prominent stablecoin UST hasn’t helped things, either. The token’s collapse ended up sinking the entire Terra network along with it. It also shook the entire stablecoin industry, knocking peers like Tether (USDT-USD) and DEI (DEI-USD) from their pegs as well.
Of course, industry-wide volatility is not going to be kind to an already struggling stablecoin; since the crash, FUSD has been stuck at a price floor of about 70 cents. Now, though, it seems like it could soon be aided by a famous Fantom developer.
Andre Cronje had retired from blockchain developing earlier this year, bringing an end to his era on the network. However, Cronje is now signaling a potential comeback. Over the weekend, the developer published a proposal for an upgrade to optimize FUSD’s price stability.
Obviously, Cronje’s potential return is exciting Fantom users. Currently, the FTM crypto is up by about 19%, even on lower volume. Over the last seven days, the coin is up more than 45%.
On the date of publication, Brenden Rearick did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.