Binance to Compensate Traders for Unusual AEUR Stablecoin Price Rally

Binance has announced a compensation plan for traders who mistakenly bought into an unusual price rally of the AEUR stablecoin. AEUR, designed to mirror the euro’s value, is a newly launched stablecoin issued by Swiss-based Anchored Coins. The incident occurred shortly after AEUR was listed on the spot market.

The AEUR-USDT trading pair experienced a significant and unexpected surge in value, peaking at $3.25 on Tuesday. This was a substantial deviation from its intended value of around $1.07. The surge was attributed to a misunderstanding among some Binance traders, who may not have realized AEUR’s nature as a stablecoin. According to a Binance spokesperson, the strong demand for AEUR, driven by its positive reception in the community, led to this price deviation.

One contributing factor to the situation was the limited liquidity of AEUR on the platform, with a supply of only five million on Binance. Moreover, the exchange had introduced a zero-fee promotion for trading the stablecoin following its launch. AEUR recorded a trading volume of $34 million during this period.

In response to the abnormal price movement, Binance temporarily suspended spot trading for various AEUR trading pairs, including AEUR/USDT, BTC/AEUR, ETH/AEUR, and EUR/AEUR.

The compensation plan announced by Binance is targeted at traders who bought AEUR between 12:41 p.m. EST and 1:31 p.m. EST on Tuesday and did not sell it on Binance. These traders will be eligible for compensation, which is set to commence within the next three days. However, the total amount allocated for compensation has not been disclosed by the exchange.

This move by Binance to compensate affected traders demonstrates the exchange’s commitment to maintaining fair trading practices and protecting its users from unintended market anomalies.