Near Foundation sets up $40 million fund to bail out USN investors in case of collapse

The program was launched after Decentral Bank, the issuer of the native USN stablecoin NEAR, raised concerns about the depegging of the stablecoin due to algorithmic failure.< /p> New

Near Protocol's internal stablecoin, USN, recently became under-collateralized, forcing Near Foundation to recommend closing USN to avoid a situation similar to the collapse of Terra (LUNA) and TerraUSD (UST). Supporting the move, the Near Foundation opened a $40 million fund to protect investors and help them withdraw equal amounts of Wrapped Tether (USDT.e) from the USN.

On October 24, the Near Foundation revealed the creation of a $40 million fund, allowing eligible USN holders to swap their USN tokens on a 1:1 basis with USDT.e. The program was launched after Decentral Bank (DCB), the issuer of the USN NEAR stablecoin, raised concerns about the stablecoin being depegged due to an algorithmic flaw.

In response to a recent issue with the USN, the @NEARFoundation is funding a protection program to protect USN holders.

More details below https://t.co/NDMZUO2Wim

The USN protection program aims to cover the $40 million collateral gap, which the foundation has confirmed is unrelated to the price of the Near Protocol (NEAR) token. Taking proactive steps to protect investors from a potential meltdown, Near said:

“The NEAR Foundation recommends that DCB win...