On December 4, 2023, the cryptocurrency exchange Binance added a new stablecoin tied to the euro, named Anchored Coins EUR (AEUR). However, the next day after trading began, AEUR's value deviated from its fiat peg, jumping nearly 200%.
For most of the day, AEUR/USDT trading pairs remained around $1.08, in line with the EUR/USD rate. However, on December 5, around 17:45 UTC, AEUR's price began to rise sharply, peaking at $3.25. Due to this "abnormal volatility," Binance temporarily suspended AEUR trading. The last transaction on the platform was closed at 18:31 UTC at about $2.89.
According to an official press release, the stablecoin was issued by the Swiss company Anchored Coins, owned by Singaporean investor and former parliamentarian Calvin Cheng. AEUR's value is expected to be backed by physical assets in euros, with a market capitalization of $5 million.
Binance did not specify the reasons for AEUR's sudden price jump. It is known that a small market capitalization and limited liquidity can make an asset more susceptible to price manipulation.
Binance representatives announced compensation for users who suffered from the loss of AEUR's peg. Under the proposed plan, those who bought AEUR through AEUR/USDT, BTC/AEUR, ETH/AEUR, and EUR/AEUR spot trading pairs from 17:41:16 to 18:31:59 (UTC) on December 5 and did not manage to sell their assets are eligible for compensation.
The statement indicated that the compensation calculation will be based on the AEUR price on Binance Spot on December 5 at 17:41 (UTC) (i.e., 1.07999 USDT per AEUR). Payments will be made within 72 hours from the announcement, as clarified by Binance. Eligible users will receive compensation in the form of USDT token vouchers by December 9, 2023.
