The USDC stablecoin
Kucoin is been sued by the US Attorney General, in that suit, the NYAGY argues that Ethereum along with coins like Luna, and UST are securities. The reasoning for this is that the management efforts of Founders and developers exist and investors could reasonably assume that they will profit from the effort of these people. This news has shaken the market because if Ethereum is deemed to be a security by the US regulator, the thing is going to get really messy in crypto. You should remember that is only in New York state, it is not a national case.
The SEC does continue that argue that everything except Bitcoin is a security but the EFCT which claims authority said Ethereum is a commodity. Every exchange that got a license in New York like Coinbase and Gemini, they have to get approved by the US regulators. They also have to get approved for every asset that they listed. Especially, what they are saying is that they gave them a license to sell this asset but now you are in violation of the security law. It is not only Kucoin in the crosshair here either of the overzealous regulators, it is basically any exchange operating in the USA right now that is going to come under intense scrutiny and a major fire.
USDC which is the second biggest stablecoin in crypto has de-pegged along with DAI stablecoin, and Frax stablecoin also de-pegged that is because those are both partially by USDC. They are both trading at around a 10% discount right now. What happened is that a bank called Silicon Valley Banks has gone under, it was holding 8% or 3.3 billion dollars worth of the USDC cash deposit. The good news is that 92% of the money back in USDC not in that bank. At least that is positive but the banks going into liquidation leads USDC in a bad place with billions tied up. Chances are they will get a lot of that money back in the bankruptcy proceedings. It is going to take a while for this to happen, and right now the other 92% of that money back to USDC is earning 4.5% interest which is around $1.7 billion a year. There is still a lot of money coming into the Circle company which is the owner of USDC.