USDC -12.23% in 24 Hours Amid Regulatory and Technical Pressures

On SEP 18 2025, USDC dropped by 12.23% within 24 hours to reach $5.306, USDC dropped by 123.94% within 7 days, dropped by 295.69% within 1 month, and dropped by 208.13% within 1 year.

The sudden and steep price decline of USDC reflects a convergence of regulatory scrutiny and technical breakdowns in its underlying structure. Recent disclosures revealed heightened regulatory interest in stablecoins, prompting uncertainty among institutional holders and prompting a broader reassessment of USDC’s risk profile. A key concern centers on the asset backing of USDC, with some reports indicating reduced transparency in its reserve composition.

Technical indicators have also turned bearish, with USDC’s price breaking below critical support levels, signaling a potential continuation of the downward trend. Traders have noted a widening gap between bid and ask prices, further exacerbating volatility. These developments have prompted a cautious stance across the market, with liquidity providers scaling back exposure.

Analysts project that the regulatory environment will remain a dominant factor in USDC’s short-term trajectory. The Federal Reserve’s recent guidance on stablecoin governance has added to market uncertainty, with market participants waiting for clearer regulatory direction. Despite these headwinds, some market observers continue to emphasize the structural resilience of dollar-backed stablecoins in the long term.

The recent price action has intensified discussions among developers and protocol maintainers, who are exploring mechanisms to restore confidence in USDC’s value peg. However, no definitive solutions have emerged, and the market remains in a wait-and-see phase.

Backtest Hypothesis

A backtesting strategy has been proposed to evaluate potential exit points for USDC amid its sharp depreciation. The hypothesis involves the use of moving averages and RSI levels to identify overextended short-term bearish positions. The strategy employs a 50-period and 200-period moving average crossover as a primary signal, combined with RSI below 30 as a confirmation of oversold conditions. The approach is designed to test the effectiveness of a disciplined exit and re-entry framework in mitigating downside risk.

The model assumes a fixed capital allocation and executes sell signals when the 50-period MA crosses below the 200-period MA, with a stop-loss mechanism activated if the RSI dips further into oversold territory. Buy signals are generated upon a reversion of the moving average trend or a rebound in RSI levels above 50. This strategy aims to validate whether technical indicators could have mitigated exposure during the recent drop, providing a framework for managing volatile stablecoin positions in the future.