Stablecoin TrueUSD ( TUSD -0.26% ) dropped below its $1 peg on Tuesday morning in Asia with selling volume mounting on Binance.

TUSD currently trades at around $0.985215 at 10:30 a.m. Hong Kong time, after dropping to as low as $0.9837 earlier today, according to The Block’s price page.

Source: The Block's data

Binance’s TUSD-USDT pair saw a total selling volume of around $435.4 million in TUSD in the past 24 hours, with about $369.3 million worth of TUSD buy orders, according to the exchange’s trading page. That indicates a net outflow of $66.1 million, the data showed.

“The massive selloff of TUSD reveals panic for its holders over the uncertainties of its reserves and instability related to Poloniex. After a recent hacking incident that targeted Poloniex, TUSD holders find themselves in an increasingly difficult situation to find stability with the USD-pegged stablecoin,” Nick Ruck, chief operating officer of ContentFi Labs, told The Block.

“It feels like such a little catalyst, but with the recent announcement of MANTA in Binance’s launchpool program and the need to stake BNB or FDUSD — at the expense of other stablecoins like TUSD that might have been used in the past for launchpool staking — it seems that a horde of investors are selling the latter for the former,” said Justin d'Anethan, head of APAC business development of crypto market maker Keyrock.

TrueUSD's response

“Recent community mining activities in relation to Binance Launchpool have been noted, leading to short-term arbitrage opportunities, which are part of the normal market dynamics and liquidity adjustment,” TrueUSD said in a statement shared with The Block.

“Our focus has always been on and continues to be the enhancement of TUSD services through innovative technologies and industry partnerships. Attestations continue in the ordinary course of business, and any suggestion to the contrary is false,” the firm further clarified.