Do Kwon, co-founder and CEO of Terraform Labs, made an important statement about what has happened over the past few days. The most authoritative name of the project recognizes the crisis that the UST has experienced. So, what will be done to solve this problem that harms investors? Will cryptocurrencies grow?
Terra (MOON) Description
Do Kwon announced on his Twitter account that they will announce a UST recovery plan. Over the weekend and especially yesterday, the UST price plummeted below $1. In the early hours of this night, the UST rate, which was supposed to be $ 1, fell to about $ 0.6. While investors switched to UST stablecoin to avoid a downturn in the cryptocurrency markets, the fact that they were unable to get rid of the loss also caused a serious reaction on social networks.
Many investors believe that people no longer trust the UST. If Terra fails to restore the necessary trust, it will cause irreversible damage to both LUNA and UST. We will share it with you here when the recovery plan is announced.
Investors reacting to the situation on social networks especially criticize the easy sale of assets from one hand. Terra has sold its Bitcoin reserves for UST and has not yet shared details. Details of the measures taken in the last 24 hours as part of this rescue plan are also expected to be announced.
At the time of writing, BTC finds buyers at $31,182. The largest cryptocurrency fell after statements by US Treasury Secretary Yellen after the IHR crisis. On the other hand, US inflation data will be published tomorrow. The fact that future data is below expectations will be associated with the success of interest rate hikes. Otherwise, however, fear will spread among investors, as the Fed may take tougher decisions.
On Thursday, Yellen will give a speech on stablecoins. TerraUSD (UST) is also expected to find its place in the speech. Having shaken confidence in algorithmic stablecoins, UST may cause distrust of the entire cryptocurrency ecosystem on the part of the regulator after recent events. It can be said that the hard-to-repair reputation of cryptocurrencies has once again been damaged.