msUSD Crashes 71% After Accountable Ends Verification Partnership

Main Street USD (msUSD) suffered a dramatic collapse over the weekend after verification provider Accountable terminated its partnership with the protocol, causing the stablecoin to lose its dollar peg and wiping out a significant portion of its market value.

The stablecoin, which had traded close to $1 for several months, plunged to around $0.29 within hours of the announcement. The sharp decline represents a loss of approximately 71% in the last 24 hours, reducing msUSD’s market capitalization to roughly $30.5 million.

Accountable, a proof-of-reserves verification company backed by Pantera Capital, provides real-time asset verification services that allow firms to confirm holdings without revealing sensitive information. The company has previously verified more than $1 billion in assets for major industry participants, including Galaxy and Amber Group.

Main Street Finance heavily promoted msUSD as an Accountable-verified stablecoin and operated a public dashboard powered by the verification provider to demonstrate collateral backing. However, Accountable announced that Main Street failed to meet its verification requirements and immediately ended the service agreement.

Following the termination, the verification dashboard stopped confirming reserves supporting msUSD, triggering concerns about the token’s backing and accelerating investor withdrawals.

Main Street marketed msUSD as a stablecoin redeemable on a one-to-one basis with USDC. Users could stake msUSD to receive msY, a yield-generating token designed to earn returns through delta-neutral options box spread strategies commonly used by institutional investors.

The protocol also relied on integrations with major decentralized finance platforms, including Morpho. After the collapse, the msY/USDC lending market on Morpho experienced severe stress, reaching 100% utilization and borrow rates of 138%. An AlphaUSDC vault reportedly maintains approximately $18 million in exposure to the affected market.

Security concerns have also resurfaced. According to blockchain security platform GoPlus, the protocol operates through an upgradeable proxy contract that grants administrators the ability to mint tokens, modify fees, and potentially restrict selling activity.

The incident highlights the risks associated with yield-bearing stablecoins and the dependence many decentralized finance projects have on third-party verification providers. With Main Street Finance yet to release an official statement, investor confidence remains fragile.

Meanwhile, msY, the protocol’s primary yield token, has also recorded substantial losses. The future of both msUSD and msY will largely depend on whether Main Street can restore trust by providing transparent proof of reserves and demonstrating sufficient collateral backing for its ecosystem.