REDEMPTION CAPACITY IS THE REAL PEG CONSTRAINT

Summary from the TLDR Crypto newsletter

Stablecoins don't fail because blockchains are slow. They fail when the issuer can't convert coins back into real dollars fast enough. The peg holds only if the issuer's cash/lines or their processing capacity can cover redemptions over the stress period. If redemptions outpace that capacity, the stablecoin's “$1” becomes a market price and liquidity fragments.