Some online are speculating that the rise in Canto price could be attributed to a spike in the volume of Note — the quasi-stablecoin issued by Canto and pegged to USDT/USDC.

Recently, some Twitter users have started to speculate that the Layer-1 decentralized token could eventually face downward pressure due to its connection to Note, cautioning investors that a collateralized peg may be different only semantically to the TerraUSD/UST algorithmic stablecoin, which collapsed in 2022 after its peg fell short resulting in a run on nearly $45 billion worth of assets.

However, members in the Canto discord community were quick to downgrade all the FUD:

“UST was not collateralized by anything; they have 10% collateralized. Here we have 100% in stablecoins. We can’t mint Note with Canto.”

(By Dorian Batycka)