Although it took over a month, the FEI stablecoin was finally able to hit the target price it had set up of $1. Ever since the stablecoin debuted on the 3rd of April, the stablecoin has not been able to trade below the parity level with the USD. From the 7th of April to the 20th of April, the cryptocurrency kept below the level of $0.80- which is more than around 20% of the peg as reported by data from CoinGecko.
FEI Has Succeeded In Its Goal- But Will It Hold On?
But then, the status for FEI started turning from the 20th of April- when the price started increasing towards the price target that was set up. On Tuesday morning, the stablecoin finally achieved its goal of $1. Yet, it is not sure if the stablecoin would be able to keep holding on to this price.
The chief design of this stablecoin is the PCV or the Protocol controlled value- which is utilized to keep the price of the cryptocurrency steady in a highly decentralized way- that would be rendered more capital efficient. The only competitor that the company has with the design is DAI, the stablecoin from MakerDAO.
This project was heavily funded by most of the elite investors in the world such as Andreessen Horowitz, Framework Ventures, as well as Coinbase Ventures. Before the stablecoin FEI was launched, the company had brought out the concept of liquidity by launching an event that promised the cryptocurrency at a discounted rate- along with the opportunities that came with TRIBE, the governance token.
To utilize this feature, all one had to do was exchange it with ETH- which attracted close to $1 billion of the cryptocurrency.
Unfortunately, while the stablecoin FEI has managed to reach its target price, the market supply keeps on decreasing. As CoinGecko reports, the market cap fell from $1.9 billion to $976 million on the 30th of April.
