The MSUSD stablecoin lost its dollar peg after the analytics firm Accountable terminated its agreement with MainStreet. The Saturday incident shut down the public Proof-of-Reserves dashboard, quickly sparking panic among investors. Within 24 hours, the crisis spread to adjacent DeFi protocols, launching a wave of emergency capital withdrawals.
This massive outflow of funds forced the Altura project to begin liquidating its investment pool. The platform's head, Ranveer Arora, reported that users withdrew over $8.5 M in USDT within a single day.
“The project team is being forced to sell off its portfolio, including exchange positions and real-world assets, to ensure instant payouts,” he wrote.
The verification failure also paralyzed the Morpho credit market, where the MainStreet oracle is set to go offline in the coming hours. Leveraged traders rushed to close their positions, triggering a sharp spike in borrowing rates.
Meanwhile, the MSUSD issuer insists the stablecoin remains fully backed, calling the situation an infrastructure issue. To support liquidity, MainStreet transferred $8 M in USDC to the system.
Project management admitted that the reserves are locked in box spread market positions, which are difficult to close early on weekends due to low market maker demand. Moving forward, the team plans to tap into its insurance fund to cover costs and protect user assets.