Stablecoin Plunges 98% in 24 Hours, Sparks Rug Pull Allegations

Early on Oct. 26, the U.S. dollar value of Essence Finance’s decentralized stablecoin, CHI, plunged by more than 90% after rumors emerged that more than $20 million of collateral had been removed. According to Geckoterminal data, the value of the stablecoin, which normally trades at par with the U.S. dollar, dropped by nearly 98% to $0.01338 in less than 24 hours. The huge drop has sparked allegations of a rug pull against the protocol’s developers. At the time of publication, Essence Finance had not issued a statement about the incident or acknowledged its impact on the protocol’s operations.