When the market is sluggish, even a slight change can trigger a chain reaction.
Last night when USD1 dropped to 0.98, I was watching a movie and missed the news.
When I got home, I saw various groups discussing WLFI co-founder Eric Trump @EricTrump
deleting posts about USD1, and everyone was in a panic, with friends privately messaging me to run fast.
I quickly skimmed through the posts on Twitter and didn’t see any official or reliable sources saying there was a problem with the project, and USD1 is a compliant stablecoin fully backed 1:1 by cash and short-term government bonds, with a robust minting/redemption mechanism, not the type of algorithmic coins that are prone to collapse.
Then I saw Teacher Vida directly bottoming out at 6m, realizing it was stable; smart money dares to catch falling knives, and the fundamentals are fine, so this wave is mostly FUD. So I didn't move and continued to hold.
Sure enough, the price gradually re-anchored around 1 dollar.
In the early morning, the official Twitter released an investigation report on this drop, stating that it was an organized coordinated attack, with hackers stealing accounts of several co-founders, including Eric, deleting posts to create FUD, and also opening a large number of short positions at $WLFI in advance, aiming to profit from the panic.
Now the market sentiment is too fragile; everyone, please stay calm and verify the news before reacting!
With so many groups casually forwarding news, everyone is afraid of running slow and collectively dumping, which results in handing over the blood-stained chips at a low price for others to take away.