Author: Monicah W

The recent depeg incident involving sUSD from Synthetix has highlighted that this sector remains fraught with risks despite the immense potential of algorithmic stablecoins. 

The sUSD incident is not the first to expose the vulnerabilities of algorithmic stablecoins. From technical challenges and regulatory pressures to dwindling community trust, projects in this space must navigate numerous obstacles to survive and thrive.

The Landscape of the Algorithmic Stablecoin Market

Algorithmic stablecoins, which maintain their value without direct asset backing, were once hailed as a breakthrough in decentralized finance (DeFi). However, according to CoinMarketCap data from April 2025, the total stablecoin market capitalization stands at $234 billion, while algorithmic stablecoins account for about $458 million, equivalent to just 0.2%.

This stark disparity reflects the reality that algorithmic stablecoins have yet to gain widespread trust from the community. High-profile failures like the collapse of UST/LUNA in 2022, coupled with regulatory uncertainties such as the EU’s MiCA framework, have fueled skepticism.

More recently, the depeg of Synthetix’s sUSD is a typical example of this model’s inherent risks.

A Deep Dive into Synthetix’s sUSD Depeg

Synthetix is a well-known DeFi protocol celebrated for its synthetic asset system. Within this ecosystem, sUSD is an algorithmic stablecoin designed to peg its value at 1 USD, backed by the SNX token and price data from Chainlink.

However, sUSD has faced significant challenges with a prolonged depeg recently. At the time of BeInCrypto’s report, sUSD was trading at 0.77 USD, which has persisted since late March 2025. The primary cause was a major liquidity provider withdrawing from the sBTC/wBTC pool on Curve, which triggered intense selling pressure on sUSD. This forced users to convert other synthetic assets like sETH or sBTC into sUSD, exacerbating the price decline.

On April 21, 2025, Kain Warwick, the founder of Synthetix, announced on X that the team had implemented an sUSD staking mechanism to address the issue. However, he noted that the mechanism remains manual and lacks a fully functional user interface (UI), which is expected to launch in a few days.

“Update on the sUSD depeg. We have implemented an sUSD staking mechanism but it’s very manual until the UI goes live in a few days. Here was my hot take from discord though,” shared Kain Warwick, founder of Synthetix.

Warwick further stated that if the incentive mechanism (carrot) proves ineffective, Synthetix would adopt stricter measures (stick) to compel stakers in the 420 pool to participate more actively. He emphasized that, with the collective net worth of SNX stakers reaching billions of USD, Synthetix has the financial resources to stabilize sUSD and resume development of derivative products on Layer 1.

No Successfully Algorithmic Stablecoin Project

Before the sUSD depeg incident, the market witnessed the dramatic collapse of UST/LUNA in 2022. UST, Terra’s algorithmic stablecoin, suffered a severe depeg, dragging LUNA’s value down from $120 to near zero. This event caused billions of USD in losses and significantly eroded trust in the algorithmic stablecoin model.

More recently, the ‘Godfather of DeFi’, Andre Cronje, behind Sonic (formerly Fantom), also shifted direction. Sonic initially developed a USD-based algorithmic stablecoin but later pivoted to a stablecoin pegged to the UAE dirham.

“Pretty sure our team cracked algo stable coins today, but previous cycle gave me so much PTSD not sure if we should implement,” Cronje stated.

Beyond technical risks, algorithmic stablecoins face mounting regulatory pressures. The EU’s MiCA regulation, effective since June 2024, imposes strict standards on stablecoin issuers to ensure consumer protection and financial stability. Under MiCA, algorithmic stablecoins are classified as ART (Asset-Referenced Token) or EMT (E-Money Token), requiring projects to meet complex compliance demands.

This intensifies the pressure on developers, especially as other jurisdictions also tighten crypto regulations.

These examples show the vulnerability of algorithmic stablecoins to liquidity shocks and market sentiment, particularly due to their lack of direct asset backing.

The Potential of Algorithmic Stablecoins

Despite the challenges, algorithmic stablecoins still hold developmental potential. A March 2025 post on X by CampbellJAustin suggested that a next-generation decentralized algorithmic stablecoin is feasible if lessons are learned from past failures.

“I actually think a next-gen decentralized algorithmic stablecoin is possible. I also think it will not be done correctly by the crypto community because the primary constraints are economic and risk management, not technological,” CampbellJAustin shared.

However, projects must focus on building more price stability mechanisms, combining algorithms with liquidity safeguards to succeed. Additionally, they should prepare for regulatory requirements, particularly in regions with stringent rules like the EU. Transparency in operations, regular audits, and clear communication with users are crucial to rebuilding community trust.

By addressing these factors, projects in this space can seize the opportunity to regain confidence and drive innovation.

The post sUSD Depeg Rekindles Terra Flashbacks—Can Algorithmic Stablecoins Ever Win Trust? appeared first on BeInCrypto.

GoPlus Security unveiled the latest playbook employed by a well-coordinated scam network targeting unsuspecting crypto users with promises of effortless USDT earnings.

Meanwhile, deepfake AI is progressively becoming a concern. Bad actors leverage authoritative voices in the industry to target unsuspecting victims. These mark an alarming disclosure that mirrors the growing sophistication of crypto fraud.

GoPlus Security Reveals Crypto Scammers’ Latest Playbook

The analysis exposes a multi-stage deception that begins with trust-building micro-transactions and ends with the silent draining of victims’ wallets.

GoPlus Security covers major blockchain networks with multidimensional risk detection. The firm revealed that the attackers operate through addresses linked to a campaign that starts with the launch of seemingly legitimate projects.

These projects entice users with the promise of “zero-cost, stable USDT rewards” in exchange for completing simple, low-effort tasks. Once initial contact is established, scammers send small tokens and minimal USDT over several days to establish legitimacy. But it’s all a calculated ruse.

The ultimate goal is to convince users to grant token approval permissions, often to externally owned accounts (EOAs). Once approvals are in place, the scammers continue sending rewards for days or weeks while monitoring wallets.

When a user’s balance crosses a threshold or revocation activity is detected, high-speed front-running bots swoop in and drain funds in seconds. These trading bots are willing to burn gas at any cost.

“This is a long game to catch big fish,” GoPlus warned in its statement.

Against this backdrop, GoPlus Security cautions against granting unlimited token approvals, especially to EOAs. The firm also urges users to adopt proactive on-chain security tools.

“There’s no such thing as free money — don’t trust projects that claim you can easily earn just by participating,” it added.

Their findings closely align with recent guidance from on-chain sleuth ZachXBT. The investigator outlined critical checks every user should perform to avoid crypto scams.

As BeInCrypto reported, these range from verifying token contracts and approval histories to using tools that limit permissions or automatically revoke dormant approvals.

Deepfake Deception: The Next Frontier of Crypto Fraud

Beyond blockchain, crypto scams are exploiting artificial intelligence at a dangerous scale. Bad actors also weaponize deepfake technology, which creates convincingly fake videos of public figures, to defraud investors.

In a warning earlier this year, Binance co-founder Changpeng Zhao (CZ) revealed AI-generated clips promoting fake investment platforms falsely endorsed by major crypto personalities.

“There are deepfake videos of me on other social media platforms. Please beware,” CZ stated.

A disturbing example recently emerged in Ghana. The country’s Ashesi University denounced a deepfake impersonation of its president, Patrick Awuah Jr. Reportedly, scammers used him to promote a scam called “Crypto Klutz.”

They embedded the video in a fake news article mimicking Graphic Online. The scammers circulated it alongside doctored X screenshots to manufacture credibility.

“…Neither Patrick Awuah nor Ashesi University is associated with this or any similar platform. Please help protect our community by reporting it as fraudulent when encountered and encourage others who see it to do the same,” the university articulated.

Cybersecurity firm McAfee added urgency to the matter, reporting that the average American now encounters three deepfake videos daily. The company outlined five red flags for spotting AI-enhanced crypto scams.

It cited too-good-to-be-true promises, fake celebrity endorsements, and non-existent exchanges or wallets. Other red flags include urgency tactics to rush decisions, and demands for private keys or upfront payments.

A Variety report confirmed that deepfake-assisted fraud surpassed $200 million in losses in Q1 2025 alone. This figure highlights how fast scammers scale operations through generative AI and synthetic media.

As on-chain scams become more patient and AI deepfakes more persuasive, the crypto community faces a dual-threat environment unlike anything seen before.

“AI-powered scams are changing the crypto game. With deepfakes, voice cloning, and AI-generated phishing, scammers are raking in millions,” trader Crypto Frontline remarked.

The post Deepfake Crypto Fraud Hits $200 Million in Q1 2025, GoPlus Reveals New Scam Tactics appeared first on BeInCrypto.

With Bitcoin’s current price at $88,178, combined with its historical resilience and expert forecasts, the overall outlook remains cautiously optimistic.

In the short term, investors should closely monitor the $83,000 support level and the $90,000 resistance threshold, as these levels are likely to shape market sentiment.

Short-Term Outlook: Correction or Bear Market?

On Easter Sunday 2025, Bitcoin reached a price of $84,600, marking its highest level on this holiday in 17 years, according to a report by DocumentingBTC on X. From $0 in 2009–2010 to $84,600 in 2025, Bitcoin has demonstrated unparalleled resilience and adoption over the years.

Bitcoin dominance (BTC.D) has also hit a 4-year high. Despite this, experts remain divided on whether an altcoin season is on the horizon.

CryptoQuant’s Head of Research, Julio Moreno, shared on X that Bitcoin’s price resistance could range between $91,000 and $92,000, aligning with the realized price on-chain for traders. According to the analysis, during a bull market (bull market score ≥ 60), this realized price often acts as support; in a bear market (bull market score ≤ 40), it serves as resistance. The current market is still considered to be in the latter scenario.

In another analysis, CryptoQuant suggests that the market is likely undergoing a typical correction rather than entering a full bear market cycle. This view aligns with Bitcoin’s current price of $88,178, which, although slightly below recent highs, remains above key support levels.

Analyst Mark Cullen has expressed particular skepticism about the $83,000 level. If Bitcoin drops below this threshold, the market could witness a stronger bearish reaction.

“Bitcoin $90,000 liquidity still calling. But, I think the $83,000 level isn’t safe, those lows from last Sunday and Wednesday are likely to get run first,” Mark Cullen stated.

A recent BeInCrypto report also mentioned that Bitcoin is eyeing a breakout above $90,000, driven by increasing momentum in the derivatives market. Breaking this level could signal a new bullish wave, potentially fueled by dip buyers and derivatives traders.

Long-Term Potential: A Bullish Future?

Looking at the long-term outlook, experts remain optimistic about Bitcoin’s trajectory.

“Seriously fam, this might be the last chance you have to buy $BTC < $100,000,” Arthur Hayes, co-founder of BitMEX, shared.

Robert Kiyosaki, the author of Rich Dad Poor Dad, posted on X that he firmly believes Bitcoin’s price will reach $180,000 to $200,000 by the end of 2025.

Bitcoin’s historical resilience following corrections supports this bullish outlook. For example, after dipping to $27,931 on Easter Sunday 2023, BTC rebounded significantly to $84,600 by 2025. This recovery pattern aligns with analysts’ views that corrections are healthy for long-term growth.

The Fear and Greed Index could also play a role in shaping investor behavior. A higher index value (indicating greed) often signals bullish sentiment, potentially pushing Bitcoin closer to the $90,000 mark and beyond.

The post Correction or Bull Trap? Analysts Split as Bitcoin (BTC) Eyes $90,000 Resistance appeared first on BeInCrypto.

This week kicked off on a positive note for Bitcoin ETFs, as institutional investors are making a strong comeback. On Monday, Bitcoin ETFs recorded over $380 million in net inflows, marking their largest single-day inflow since January 30.

The spike in capital inflow signals a renewed wave of institutional confidence in the leading coin, following an extended period of subdued activity in the ETF market.

Bitcoin ETFs Record Strong $381 Million Inflows

On Monday, net inflows in BTC ETFs totaled $381.40 million. The last time Bitcoin ETFs saw such a substantial injection of funds in a single day was nearly 13 weeks ago, making this latest surge notable.

The influx of capital reflects a resurgence in bullish bias among institutional investors toward BTC, at a time when broader sentiment has remained relatively cautious.

Yesterday, Ark Invest and 21Shares’ ETF ARKB recorded the largest daily net inflow, totaling $116.13 million, bringing its total cumulative net inflows to $2.60 billion.

Fidelity’s ETF FBTC came in second place with a net inflow of $87.61 million. The ETF’s total historical net inflows now stand at $11.37 billion.

Investor Confidence Rises

BTC has recorded a modest 1% gain over the past 24 hours. This price surge has prompted an uptick in the count of new open contracts in the coin’s futures market, reflected by its rising futures open interest. At press time, this is at $58.46 billion, climbing 5% over the past day. 

An asset’s open interest measures its total number of outstanding derivative contracts, such as futures or options that have not been settled or closed. 

When BTC’s open interest rises along with its price, it indicates that more traders are entering the market, either opening new long or short positions. This is a bullish signal confirming growing investor interest in the king coin. 

Further, BTC’s funding rate is positive at press time, highlighting the market’s confidence in its future price performance. This currently stands at 0.0068%.

When an asset’s funding rate is positive like this, long traders pay short traders. This means that more traders are betting on BTC’s going up, reflecting bullish market sentiment.

Moreover, today’s high demand for calls in the BTC options market supports this bullish outlook. According to Deribit, BTC’s put-to-call ratio is currently at 0.71.

This indicates that more call options are traded than puts, suggesting a bullish bias among options traders. This low ratio reflects growing investor confidence and expectations of upward price movement.

The post Bitcoin ETFs See Biggest Net Inflows in 3 Months | ETF News appeared first on BeInCrypto.