Related Experiment Video
Updated: Jul 30, 2025

A Package of Established Analytical Tools to Investigate the Solid-State Alteration of Lipid-Based Excipients
Published on: August 9, 2022
Intelligent design: stablecoins (in)stability and collateral during market turbulence
Riccardo De Blasis1, Luca Galati2,3,4, Alexander Webb2
1Department of Management, Marche Polytechnic University, Via Lodovico Menicucci 6, 60121 Ancona, AN Italy.
Abstract:
How does stablecoin design affect market behavior during turbulent periods? Stablecoins attempt to maintain a "stable" peg to the US dollar, but do so with widely varying structural designs. The spectacular collapse of the TerraUSD (UST) stablecoin and the linked Terra (LUNA) token in May 2022 precipitated a series of reactions across major stablecoins, with some experiencing a fall in value and others gaining value. Using a Baba, Engle, Kraft and Kroner (1990) (BEKK) model, we examine the reaction to this exogenous shock and find significant contagion effects from the UST collapse, likely partially due to herding behavior among traders. We test the varying reactions among stablecoins and find that stablecoin design differences affect the direction, magnitude, and duration of the response to shocks. We discuss the implications for stablecoin developers, exchanges, traders, and regulators.
Related Concept Videos
Stability
The stability of an LTI system is determined by the roots of its characteristic equation, known as poles. A system is stable if it produces a bounded...
Stability of Equilibrium Configuration
A stable equilibrium occurs when a system tends to return to its original position when given a small displacement, and the potential energy is at its minimum. An example of a stable equilibrium is when a cantilever beam is fixed at one end and a weight is attached to the other end. If the weight...
Oscillations about an Equilibrium Position
Stability of Equilibrium Configuration: Problem Solving
Problem-solving in the context of the stability of equilibrium configuration...
Stability of structures
Pole and System Stability
Simple poles are unique roots of the denominator polynomial. Each simple pole corresponds to a distinct solution to the system's characteristic equation, typically resulting in exponential decay terms in the system's...

