Homecryptocurrency News

A look at what's changed for Terra over the weekend

This article is more than 1 month old.

A look at what's changed for Terra over the weekend

Mini

"The Terra blockchain has resumed block production. Validators have decided to disable on-chain swaps, and IBC channels are now closed. Users are encouraged to bridge off-chain assets, such as bETH, to their native chains,” read the official update posted by the blockchain.

A look at what's changed for Terra over the weekend
While the broader crypto market is still reeling from a difficult last few days, it's been a particularly rough week for the Terra blockchain. On May 8, 2022, Terra's native stablecoin, UST, briefly lost its peg with the US Dollar. While it did show signs of recovering from the de-peg, massive fear and uncertainty overcame investors, leading to a huge LUNA sell-off.
LUNA is the native cryptocurrency of the Terra blockchain. It is also used to maintain UST's 1:1 peg with the US dollar. A complex algorithm burns and mints LUNA to support UST's $1 valuation. However, with UST's brief de-peg, LUNA went into a rapid downward spiral, plummeting from $85 on 5 May to $0.02 on May 13.
Current price valuations:
As far as valuations are concerned, LUNA and UST are still in the dumps. At the time of writing, LUNA was trading at $0.0002283, down by 26 percent in the last 24 hours. The pain also continues for UST, trading at $0.164 and down 12 percent over the previous 24 hours, per data from CoinMarketCap.
Terra restarts after brief pause:
With the LUNA nearing a $0 valuation, anyone could purchase a massive amount of coins and use them to sway governance proposals. To ensure this did not happen, the Terra blockchain was officially paused on May 12 at the block height of 7607789 to prevent governance attacks. Validators used the downtime to introduce a patch that disabled delegations and the network restarted late in the evening on May 13.
"The Terra blockchain has resumed block production. Validators have decided to disable on-chain swaps, and IBC channels are now closed. Users are encouraged to bridge off-chain assets, such as bETH, to their native chains,” read the official update posted by the blockchain.
LUNA delisted from Indian crypto exchanges:
Faltering price valuations are just one of the problems for Terra. Over the last few days, several global crypto exchanges such as Binance, eToro, Bybit, BitMex, and others have delisted LUNA to protect investor interests. Over the weekend, Indian crypto exchanges, including WazirX, CoinDCX, and Coinswitch Kuber have also decided to follow suit - a significant blow to the already bleeding blockchain.
In a blog post explaining the delisting, WazirX wrote, "At WazirX, we periodically review each token we list to ensure that it continues to meet the high level of standard we expect. When a coin or token no longer meets this standard or the industry changes, we conduct a more in-depth review and potentially delist it. We believe this best protects all our users."
Terra Revival plans:
In an attempt to revive the dying blockchain, Do Kwon, the co-founder of Terraform Labs, tabled a "Terra Ecosystem Revival Plan". In a nutshell, this revival plan calls for a complete restart of the Terra ecosystem. It will put the ownership of the network fully in the hands of UST and LUNA holders. The plan also involves the minting of 1 billion new tokens.
"Even if the
"UST holders need to own a large share of the network, as the network's debt holders, they deserve to be compensated for the tokens they have been holding to the end," he went on to add.
LUNA sees a 200% surge in trading volume:
Shortly after Do Kwon tabled his revival plans, LUNA surged 600 percent in value on May 14. Experts have attributed this spike to short-term investors looking to profit from LUNA's 'insane volatility'. As hopes of a rebound surfaced, LUNA's trading volume shot up by 200 percent, reaching a massive $6 billion. To put this into perspective, LUNA's usual trading volume before the crash hovered around $2 billion for the last two years.
next story

Market Movers

Currency

CompanyPriceChng%Chng