# Replace USDT with USDP \[derisk\] **URL:** \ **Category:** Proposals\ **Created:** [May 14, 2022, 4:55pm UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340 "2022-05-14T16:55:00Z")\ **Posts on this page:** 10\ **Page:** 1
**Author:** ![thesoberknight](https://sea2.discourse-cdn.com/flex020/user_avatar/gov.gmx.io/thesoberknight/32/144_2.png) [@thesoberknight](https://gov.gmx.io/u/thesoberknight)\ **Post date:** [May 14, 2022, 4:55pm UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/1 "2022-05-14T16:55:00Z")
It’s been know for some time that USDT may not fully be pegged to the $. Moreover, USDT has come under scrutiny in light of recent UST de-pegging. This presents a systematic risk to the GLP pool. We propose replacing the ~8% USDT in the Arbitrum GLP pool with [USDP](https://paxos.com/2021/08/24/the-digital-dollar-that-always-equals-a-dollar-paxos-standard-pax-is-now-pax-dollar-usdp/). > USDP is the stable coin of Paxos. USDP is reviewed by a top-ranking auditing firm on a monthly basis and will help derisk the platform. ---
**Author:** ![Xorol\_C](https://sea2.discourse-cdn.com/flex020/user_avatar/gov.gmx.io/xorol_c/32/99_2.png) [@Xorol\_C](https://gov.gmx.io/u/Xorol_C)\ **Post date:** [May 16, 2022, 5:51am UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/2 "2022-05-16T05:51:03Z")
I like the idea tbh. Tether doesn´t seem to be utilized a lot on the platform anymore and i am too worried about USDT not being fully backed. ---
**Author:** ![Tano](https://sea2.discourse-cdn.com/flex020/user_avatar/gov.gmx.io/tano/32/66_2.png) [@Tano](https://gov.gmx.io/u/Tano)\ **Post date:** [May 16, 2022, 8:42am UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/3 "2022-05-16T08:42:50Z")
Not really fan, USDT is one of the more resilient coins out there, hence the unpeg FUD. USDP also isn’t used in a lot of places, so not really a good idea and wouldn’t be utilized in GLP anyway. ---
**Author:** ![Jonezee](https://sea2.discourse-cdn.com/flex020/user_avatar/gov.gmx.io/jonezee/32/1238_2.png) [@Jonezee](https://gov.gmx.io/u/Jonezee)\ **Post date:** [May 16, 2022, 2:11pm UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/4 "2022-05-16T14:11:02Z")
Agreeing with Tano. There’s no significant volume in USDP, while we would be sacrificing significant volume in Tether perps and swaps. I don’t believe the risk of tether failing is significant, considering its backing - and backers. ---
**Author:** ![Micnation](https://sea2.discourse-cdn.com/flex020/user_avatar/gov.gmx.io/micnation/32/32_2.png) [@Micnation](https://gov.gmx.io/u/Micnation)\ **Post date:** [May 16, 2022, 2:42pm UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/5 "2022-05-16T14:42:10Z")
While I agree that usdp may have better backing and be in a better position when US regulators start scrutinizing stables - including tether, it sounds like you and others are evidently suffering from the widespread misconception that usdt is like UST in some way. considering its market cap I believe any catastrophic collapse of usdt would affect other stables as well, but it is not an algo-stable and it rarely de-pegs more than a couple percent, so I think these concerns are overblown. ---
**Author:** ![thesoberknight](https://sea2.discourse-cdn.com/flex020/user_avatar/gov.gmx.io/thesoberknight/32/144_2.png) [@thesoberknight](https://gov.gmx.io/u/thesoberknight)\ **Post date:** [May 17, 2022, 3:21am UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/6 "2022-05-17T03:21:12Z")
Thank you for all the feedback. Though I do understand the differences between UST and USDT, I agree with most of what you said. There is a risk of USDT getting fully audited and imploding but I guess the whole crypto market will go down with it in that case so it doesnt matter. ---
**Author:** ![eosdapper](https://avatars.discourse-cdn.com/v4/letter/e/b487fb/32.png) [@eosdapper](https://gov.gmx.io/u/eosdapper)\ **Post date:** [May 18, 2022, 6:00am UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/7 "2022-05-18T06:00:26Z")
USDT is fine with that reasonable weight in GLP. It survive all these years with constant FUD going on tho ---
**Author:** ![coinflipcanda](https://sea2.discourse-cdn.com/flex020/user_avatar/gov.gmx.io/coinflipcanda/32/207_2.png) [@coinflipcanda](https://gov.gmx.io/u/coinflipcanda)\ **Post date:** [May 18, 2022, 7:27am UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/8 "2022-05-18T07:27:58Z")
While peg risks should be monitored, one under appreciated value of USDT is that it is the base trading pair for perps on the main CEXs. Which means that over time as on-chain and off-chain stratagies are developed, USDT becomes a natural token of exchange, much in the way USDC has become the preferred onchain token of cross-chain transfer. ---
**Author:** ![acv](https://avatars.discourse-cdn.com/v4/letter/a/f07891/32.png) [@acv](https://gov.gmx.io/u/acv)\ **Post date:** [May 19, 2022, 1:19pm UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/9 "2022-05-19T13:19:05Z")
I would not be for this. USDT brings volume and fees. I think the backing risk is overblown. ---
**Author:** ![iamnaok](https://avatars.discourse-cdn.com/v4/letter/i/a587f6/32.png) [@iamnaok](https://gov.gmx.io/u/iamnaok)\ **Post date:** [June 6, 2022, 12:47am UTC](https://gov.gmx.io/t/replace-usdt-with-usdp-derisk/340/10 "2022-06-06T00:47:35Z")
These are the only stables we need (24H trading volume over $100M): ![Stables](https://us1.discourse-cdn.com/flex020/uploads/gmx/original/1X/72aed2668a7062016cc9edd2dea2315c4f9a51ed.jpeg)