Falcon USD stablecoin depeg, Liquidity and Collateral quality raise concerns

BTC0.98%
According to ChainCatcher news and Cointelegraph report, the over-collateralized stablecoin Falcon USD (USDF) issued by the DeFi protocol Falcon Finance fell below the $1 peg on July 9, hitting a low of $0.9783. Data shows that the on-chain liquidity of this stablecoin has dropped to $5.51 million, shrinking by over 80% from its peak.
Andrei Grachev, managing partner of Falcon Finance, responded that 89% of the USDF collateral is stablecoins and Bitcoin, with an over-collateralization rate of 116%. However, the DeFi research organization LlamaRisk reported that the project team has unilateral management rights over the collateral assets and that there is a risk of over-issuance.
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