The stablecoin depeg protection protects you against deviations of 1% or more (rounding to 3 decimal places) compared to the target 1:1 ratio between stablecoins and their underlying asset (e.g. 1 USDC or USDT should equal 1 USD), if the loss is irreversible and permanent.
Whether the loss is with the payer or recipient depends on the depeg and the rate applied during payment. You or your vendor can choose to either use live rates during payment (→ Which conversion rates does Request Finance use?) or enable a fixed 1:1 conversion between stablecoin and fiat currencies.
If live rates are applied during payment
If live rates are applied and a depeg happens at the time of payment, then the payable amount will be adjusted automatically.
Example: Suppose you receive a $100 bill payable in USDC. If, at the time of payment, the stablecoin depegs, making 1 USDC equal to 0.5 USD, you would have to pay 200 USDC instead of the expected 100 USDC if USDC was at peg.
In this case, if the stablecoin protection fails to notify you of the depeg and the bill is settled at a 100 USDC loss (200 USDC paid instead of the expected 100 USDC), you could claim 100 USDC accordingly, if the loss is irreversible and permanent.
If rates are fixed during payment
If live rates are fixed and a depeg happens at the time of payment, then the payable amount will continue to be set at 1:1 to the fiat value.
Example: Suppose you receive a $100 bill payable in USDC. If, at the time of payment, the stablecoin depegs, making 1 USDC equal to 0.5 USD, you would have still have to pay 100 USDC.
In this case, if the stablecoin protection fails to notify you of the depeg and the bill is settled at a 100 USDC loss for the recipient (100 USDC paid instead of the required 200 USDC), the recipient could claim 100 USDC accordingly, if the loss is irreversible and permanent.