Executive Summary
DEWS WATCH band swelled from 49 to 58 coins overnight as PSI posted its first uptick in 7 days, climbing 0.8 to 87.1. The relief looks thinner than the stress building beneath it.
PSI ticked up to 87.1 from yesterday's 85.6, the first daily gain in a week, yet the broader trajectory tells a grimmer story: 95.2 to 87.1 across seven days, a slide of 8.1 points that carried the index clean out of BEDROCK and into a fourth consecutive day of STEADY. The recovery, if you can call 0.8 points that, feels cosmetic against a DEWS distribution that quietly shifted 9 coins from CALM to WATCH overnight, swelling the WATCH cohort from 49 to 58.
Stress Signals. USDX remains the lone WARNING at score 59, its liquidity erosion reading 93 and pool balance drift at 87 on a $39.47M coin that nobody is rushing to defend. More consequential is the cluster below it: SUSD at ALERT 44 with a perfect 100 on cross-source divergence, LUSD at ALERT 43 driving 8.3 severity points into PSI while carrying a 275 bps depeg on just $30.14M in market cap, and IUSD at ALERT 36 after a full pressure reversal of negative 100 on yesterday's $6.74M net outflow. BRZ, rated D with a peg score of 23, remains the single largest severity contributor at 26.7, its 156 bps wobble amplified by a $262.21M cap that dwarfs anything else misbehaving.
Liquidity Rotation. The day's sharpest structural move belongs to syrupUSDC, whose DEX TVL was cut from $79.23M to $33.53M, a 58% single-day evaporation on a $1.79B coin. That liquidity score drop from 62 to 54 looks modest until you consider the dollar volume that vanished. On the other side, GHO added $5.59M in TVL and USD0 gained $6.61M, both climbing while total stablecoin market cap shed $698.91M over the week. USDC bore the brunt, losing $602.65M and slipping 1% below its ATH of $79.58B set just six days ago. The Bank Run Gauge sits at negative 35.7, CAUTIOUS but not panicking, which may be the most unsettling reading of all.