USDT drops to 7 yuan? The price difference is widening! Is this a precursor to a collapse, or an overreaction of emotions? The truth is here

Recently, the off-exchange price of USDT has slid to around 7.0 RMB, while the bank's dollar exchange rate is still around 7.12, with a price difference close to 0.12 — this scene is rarely seen and is enough to raise concerns in the market:

Will USDT experience a "collapse"?

First, the conclusion:

Short-term volatility is severe, but the probability of a collapse is low; emotions outweigh fundamentals.

Why is it dropping? It's simple: policy impact + declining demand.

First, high-pressure policies have led to a rapid contraction in USDT demand.

The central bank, along with multiple departments, has once again emphasized a crackdown on illegal operations related to USDT, cross-border capital flows, and cryptocurrency speculation, with a strength that is noticeably stronger than in previous months, making the market naturally associate it with the comprehensive rectification in 2021.

Once the policy winds blow, many people dare not buy large amounts of USDT, and even sell in advance, resulting in a clear cooling of demand and a natural price decline.

Second, short-term panic has amplified the decline.

Now, off-exchange market makers are more cautious, and quotes are more conservative; retail investors are worried about increased regulation and would rather incur a small loss to exchange back for RMB.

This results in one outcome —

USDT does not seem to be "unwanted", but rather "everyone is waiting for policy clarity".

So will there be a collapse?

A real collapse requires three conditions:

1. USDT itself detaches from its peg (currently not the case)

2. Massive off-exchange sell-offs with no one to take over (currently it's a volume reduction, not a panic sell-off)

3. On-chain redemption crisis emerges (does not exist, USDT reserves continue to increase)

The current issue is not that there is a fundamental problem with USDT, but that domestic demand is temporarily suppressed by policy.

What happens next?

1. If policies continue to tighten, USDT may maintain low-level fluctuations.

2. If the policy winds weaken, USDT prices will quickly return to a normal range.

3. Low off-exchange prices represent a sentiment bottom, not a fundamental collapse.

Suggestions:

Observe the details of policy implementation, rather than being frightened by short-term prices.

USDT dropping to 7 does not mean "it will collapse", but it does mean —

The cold winds of sentiment are more dangerous than the storms of the market.