DEGO Finance (DEGO) Price continued to free autumn in the community FUD (fear, uncertainty and suspicion) on Wednesday, June 4.
The announcement included the USD1 Stablecoin, which was started by the Liberty Financial of the Trump family.
DEGO Price falls 60%: What is the cause of the conflict?
DEGO Price, the default token of DEGO Finance, has dropped almost 60%after the project announcement that it will support USD1, the Stablecoin of World Liberty Financial (WLFI) as part of the new liquidity initiative of BNB chain.
“We officially purchase $ 1 World Liberty Financial as a liquidity reserve and support the liquidity program that WLFI (World Liberty Financial) started in the BNB chain. Seek.
The team has made a movement as a strategic stage to strengthen the defect infrastructure. Nevertheless, the market reaction was rapid and cruel.
DEGO’s price collapsed. The relative robbery index (RSI), a momentum indicator, Overflow territory.
This decline suggests the fear and confusion between the holders. Some community members supported the theoretical basis of this decision, but admitted why this movement is related.
One user said, “If you add the liquidity of DEGO to USD1, the user can improve the DEGO stable market access and price stability.
Add fluidity in encryption to provide asset pools such as DEX (DEGO), which usually form pairs with DEGO and USD1 to facilitate transactions.
This allows users to buy and sell DEGO more easily, not just depend on other volatile encryption, so that they can potentially stabilize the price. However, some factors are likely to contribute to the Fud.
Among them, more than half of USD1’s PancakeSWAP DEX liquidity comes out of only three wallets and raises questions about “real demand”. Beincrypto reported that three wallets have 93%of their market cap.
If the USD1 itself lacks organic use and is raised by some large players (perhaps a market manufacturer or a team behind it), skepticism can occur among DEGO investors.
Thus, investors may worry that the liquidity grass of deo/USD1 will be artificial or manipulated. Such concerns can lead to uncertainty of deo’s true value.
The market recognizes FUD by making DEGO a dangerous or suspicious movement because USD1 is widely adopted or not trusted.
In this background, there is a concern that DEGO can be a fraudulent project, and distrust is growing among certain retail investors.
To solve the community fear, Dego Finance issued an official statement on Thursday, June 5, in a rapid sale of investor nerves.
“We know the recent price volatility that has caused concern throughout the community since the announcement on June 4. First of all, we had no change in DEGO’s foundation, token genetics or long -term vision.
The team thought that the price drop was due to the short -term market sentiment rather than the fundamental defects of the project.
The team explained, “Selling seems to be led by short -term market reactions, and we are actively considering chain data and external factors to ensure transparency.”
DEGO Finance tried to work closely with “major partners and exchange to maintain stability”. The project also stressed that long -term mission remains.
The company also urged the community to continue to participate as it was able to obtain more information by promising updates and development.
Meanwhile, it is worth noting that DEGO is not the first time the price has collided rapidly. In 2021, token decreased 51% in three minutes after being listed on Binance Launchpool. Reportedly, the cause of the decline is unclear to this day.
The latest market reaction reflects the vulnerability of investor trust, and DEGO TOKEN is a transaction of $ 1.26 at this article.
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