Both legs move

You hold stablecoin A and owe stablecoin B. A stays at 1.00 and B rises to 1.03. What happened to your position?

• Nothing, because A held its peg
• You lost about 3% of the position, because what you owe now costs more
• You gained, because a higher price is good for stablecoins

Why can a venue's freeze hurt a cross-stable position even if the peg recovers later?

• A freeze sells your collateral at the low price
• It stops new supply and borrowing of the asset, so you can't adjust the position when you need to
• It doubles the borrow rate on the frozen asset