Binance suspended trading of AEUR after it rose by 200% and pledged to reimburse traders for losses

The asset is positioned as a stablecoin and should normally be worth 1 EUR

06.12.2023 - 15:15

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What’s new? A day after the listing, the Binance crypto exchange suspended trading in Anchored Coins EUR (AEUR). The company explained that the reason was the “abnormal volatility” of the asset: after its placement on the platform, its rate almost doubled and reached $3,25. At the same time, the asset is positioned as a stablecoin and normally should cost 1 EUR or $1,8. Binance pledged to pay compensation to traders in connection with this incident.

Material by The Block

What else is known? To protect users, the exchange has suspended spot trading of AEUR in pairs with BTC, ETH, USDT, and EUR, while still allowing deposits and withdrawals.

Binance has also developed a plan to compensate those who bought AEUR above its perceived value. Thus, users who bought the asset on the exchange on December 5 between 17:00 and 18:31 UTC and subsequently did not resell it can count on reimbursements. In this, the exchange did not disclose the total amount allocated for reimbursement of damage.

Binance attributed the incident to the fact that not all traders were aware of the nature of the asset:

“As AEUR has been well-received by the community, including users who might not have realized its standing as a stablecoin, there was strong demand for AEUR, which resulted in its price deviation.”

At the same time, AEUR had limited liquidity: only 5 million coins were placed on the platform. In addition, Binance simultaneously with the listing canceled fees for both makers and takers.

The euro-pegged stablecoin AEUR is issued by Swiss company Anchored Coins AG on Ethereum and BNB Chain blockchains. The reserves are audited by Prescient Assurance, an independent firm. Binance intends to resume trading in the asset at a later date.

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