[Update] Binance Announces Compensation for Users Affected by AEUR Price Overpeg

The stablecoin AEUR, pegged to the Euro newly launched by Binance, swiftly halted trading after surging threefold above its intended market capitalization. Later that day, the exchange announced a compensation framework for affected users.

Stablecoin AEUR suspended by Binance due to surging to $3.25. Photo: Binance

Update as of noon on 08/12/2023:

Finally, after a two-day suspension, trading pairs involving stablecoin AEUR will resume at 09:00 PM on 08/12 according to Vietnam time.

Update as of the afternoon on 06/12/2023:

Following several hours of trading suspension for AEUR, Binance officially announced compensation for affected users.

Specifically, users are eligible for compensation if:

• They purchased AEUR via spot pairs AEUR/USDT, BTC/AEUR, ETH/AEUR, and EUR/AEUR during the Compensation Period from 00:41:16 to 01:31:59 on 06/12 as per Vietnam time (referred to as the Compensation Time); and
• They did not sell any AEUR held on Binance Spot before 01:31:59 on 06/12 as per Vietnam time.

They will receive back the equivalent USDT amount to compensate for their losses during the specified time. The exchange provided an example of how compensation is calculated:

Assume during the Compensation Time, user A bought 100 AEUR via BTC/AEUR when BTC was priced at 26,000 AEUR and sold 10 AEUR via BTC/AEUR when BTC was at 30,000 AEUR.

At the time of A's AEUR purchase, the BTC price was equivalent to 43,600 USDT.

Net AEUR purchased = (100 - 10) AEUR = 90 AEUR

Average purchase price of AEUR = [(100 AEUR / 26,000 AEUR) * 43,600 USDT] / 100 AEUR = 1.6769 USDT

Total compensation A will receive = (90 * 1.6769 USDT) - (90 * 1.07999 USDT) = 53.7219 USDT

The exchange will issue USDT reward vouchers to affected users, which can then be exchanged for the corresponding USDT amount.

It's important to note that as of now, trading pairs involving stablecoin AEUR have not yet resumed. However, deposit and withdrawal activities are operating as usual.

Original Article:

As reported by Coin68, Binance listed a new stablecoin named Anchored Coins Euro (AEUR) on December 4, 2023, guaranteed to be pegged to the euro.

To stimulate user interest, the exchange also offered fee-free trading for AEUR/USDT, BTC/AEUR, ETH/AEUR, and EUR/AEUR pairs.

AEUR is a stablecoin issued by Anchored Coins, a company registered in Switzerland. According to information provided on the website, only slightly over 5 million AEUR has been issued, corresponding to the 5 million euros held by Anchored Coins to secure its value.

Since its launch on Binance, AEUR maintained a stable value around $1.08 USD, equivalent to the exchange rate between the US dollar and the euro. However, by the early hours of December 6, as Bitcoin began its upward climb towards $44,000 USD, AEUR started deviating from its intended value.

Price fluctuation of stablecoin AEUR on Binance in the early morning of 06/12/2023.

In just minutes, AEUR skyrocketed to $3.25 USD, more than tripling its initial price. Trading volume for the stablecoin also surged correspondingly to 14.6 million AEUR, or $26.7 million USD, tripling its current supply.

Faced with these unusual fluctuations, Binance was compelled to issue a notice to temporarily halt trading for all pairs involving AEUR until further updates.

AEUR is the second "novel" stablecoin listed by Binance, following FDUSD in July 2023. These stablecoins are seen as part of the exchange's efforts to meet user demand after BUSD ceased operations due to pressure from US authorities.

Former Binance CEO Changpeng Zhao hinted during an AMA session in July about plans to launch more stablecoins in the future.