apxUSD depegged to $0.93 after STRC shares fell below $100 par. Apyx says the model uses dividend hikes to restore the peg — a mechanism that has worked four times since August.
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Stablecoin depegs are a recurring feature of crypto bear markets. The latest candidate is apxUSD, the preferred equity-backed stablecoin of the Apyx protocol.
As market leader Bitcoin fell sharply in recent sessions, reaching lows under $63,000 at one point, apxUSD briefly slipped to as low as 93 cents, deviating from its 1:1 dollar peg, according to CoinMarketCap. The event rattled secondary market confidence and raised questions about the structural soundness of collateralized stablecoin models that depend on volatile underlying assets.
The stablecoin is primarily backed by preferred equity issued by digital asset treasury firms – specifically Strategy's STRC shares, which carry a $100 par value. The protocol purchases those shares, collects the dividend they pay, and distributes the yield to onchain holders. The reserve basket also includes short-term U.S. Treasuries and cash equivalents to ensure liquidity and reduce concentration risk.
Apyx runs a two-token system. apxUSD is the base stablecoin designed to trade at $1 and does not pay yield. Holders who deposit apxUSD receive apyUSD, a yield-bearing savings token that accrues returns through dividends flowing in from the underlying preferred shares.
That said, because preferred equity makes up the majority of those reserves, the stablecoin is influenced by volatility in the underlying shares. When STRC trades below its $100 par value, the market value of apxUSD's reserves declines, leading to volatility in secondary markets.
According to Apyx, this is not an extraordinary development. The protocol's peg stability model has multiple layers to absorb stress. The preferred shares have structural features that allow issuers to raise dividend rates, which draws demand for the shares, lifting their value toward par over time.
Key insight: The depeg is not a liquidity failure but a mechanical response to a temporary discount in the underlying collateral – the same mechanism that should eventually restore the peg through dividend adjustments.
Strategy has historically used this lever. STRC has traded below its par value four times since August last year, and each episode ended with prices bouncing back to $100.
Beyond that, Apyx said it maintains collateral value in excess of the stablecoin's circulating supply. This buffer helps absorb mark-to-market drawdowns in the backing assets before they meaningfully impact the peg.
The depeg came as market participants panicked, with some saying persistent volatility could shake investor confidence. There were also concerns about cascading liquidations across Morpho lending markets, but Apyx said those were largely misplaced.
The main apyUSD/apxUSD Morpho market is driven by dividend accrual, not STRC's spot price. Volatility in STRC does not impact that oracle and does not trigger liquidations.
Risk to watch: The peg is most vulnerable if STRC stays below par for an extended period without a dividend hike. Three signals that would confirm the mechanism is working:
What would weaken the case:
The Apyx protocol now faces its first real stress test since launch. If STRC dividend hikes restore par pricing quickly, the model gains credibility. A drawn-out discount would force a redesign of how preferred-equity-backed stablecoins manage market volatility. For now, the mechanism has worked in four prior episodes. The question is whether the fifth looks different.
Practical rule: A preferred-equity-backed stablecoin is only as stable as the issuer's willingness to adjust dividend rates. Watch STRC's dividend announcements and the overcollateralization ratio before drawing conclusions from secondary market price action alone.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.