Although USDT is designed to maintain a perfect 1:1 peg with the US dollar, temporary price deviations — known as depegs — have occurred throughout its history. Understanding these events is important for traders and institutions relying on USDT for liquidity and value storage.
Despite several notable stress events, USDT has consistently recovered its $1 peg, demonstrating the resilience of Tether's reserve model.
The most significant depeg occurred in May 2022 during the broader crypto market collapse triggered by the TerraUSD (UST) algorithmic stablecoin failure. USDT briefly fell to approximately $0.9956 as panic selling hit the stablecoin sector. However, Tether processed over $15 billion in redemptions — equivalent to 20% of its total supply at the time — without halting withdrawals, and the peg recovered within 24 hours.
June 2023: Curve Pool Imbalance
In June 2023, USDT experienced a minor depeg to approximately $0.996 due to a liquidity imbalance in Curve Finance's 3Pool. The imbalance was caused by large USDT withdrawals that skewed the pool's composition. Once liquidity providers rebalanced the pool and arbitrageurs stepped in, the peg was fully restored later the same day. These events highlight that while USDT is highly resilient, it is not entirely immune to short-term market dislocations.
- 2022 Terra collapse: USDT dipped to ~$0.9956, recovered in 24h
- 2023 Curve imbalance: USDT hit $0.996, recovered same day
- $15B+ in redemptions processed during 2022 stress without halting
- Market cap exceeded $184 billion as of early 2026