As if the crypto market did not have enough uncertainties in recent days (as well as the stock market and technology shares), we must add that one of the cryptocurrencies known for its promise of low volatility and price attached to the dollar, has suddenly fallen.
TerraUST (or just UST) is a stablecoin. That means that behind the crypto there is a store of value to prevent the token have the volatility of cryptocurrencies. Its system is based on an algorithm that adjusts the offer and “burns” tokens to stabilize the price always taking into account the dollar. At least until now. Crypto is nothing less if you consider that, as of December 2021, there was a total of 9.5 billion tokens circulating.
TerraUST crashed to 30 cents in a matter of hours and at the time of this writing it appears to be stabilizing. The graph of him with Japanese candles with the help of Binance is as follows:
The creator behind the stablecoin it is Do Kwon, also creator of one of the most popular cryptos with the highest volume of transactions, LUNA. The LUNA crypto, sister to TerraUST, also fell sharply by more than 90% of its value. The graph of the previous day is as follows:
The TerraUST issue seems to be taken care of after the crash. Do Kwon said on his Twitter account that various solutions are being discussed in the community forums of the stablecoinbeing the main one to get a massive collection to get the price up, but in any case he assured that the focus of the UST has always been “long-term“.
More complicated is the issue of LUNA, which in its worst collapse lost 99% of its value and for which there is no plan to rescue it. Only in the last 24 hours each token went from being worth 31 to just two dollars.
Before the crashes, both TERRAUST and LUNA were in the top ten list of cryptocurrencies by market capitalization
The drops of UST and LUNA are due to a massive sale of the tokens. Caetano Manfrini, a lawyer specializing in blockchain, assured that it should have been a “coordinated attack“, as he wrote in a tweet that was later retweeted by Kwon himself. The truth is that the downward trend has been noticed for days now, along with the latest crash of bitcoin and ethereum, a product in part of the uncertainties caused by the rise in interest rates in the United States.