As the crypto community still tries to understand Terra’s ongoing pegging-depegging fiasco with regards to the stablecoin offering of the USD USD (UST), major crypto exchange Binance on Tuesday suspended withdrawals for LUNA and UST until further notice. announced suspension.
The market cap of UST, Terra’s stablecoin offering, recently fell below the expected $1 price point as the price of Luna saw a sharp drop due to a major selloff. Meanwhile, the BTC/UST trading pair on Binance hit a high of over $42,000 while other bitcoin dollar markets struggled to defend $30,000, as reported by Cointelegraph.
Which has led to a huge jump in BTCUST (Bitcoin is not valued in dollars, but in the UST stablecoin). pic.twitter.com/Xn7qcy4VMZ
— Blockchain Backer (@BCBacker) 10 May 2022
As a reactive measure against the ongoing uncertainty within the Terra ecosystem, Binance temporarily suspended all withdrawals for the LUNA and UST tokens, citing a large volume of pending withdrawal transactions.
Withdrawal on Terra Network $luna Temporarily suspended. https://t.co/hIGrAEzOwD
– Binance[@binance] 10 May 2022
According to Binance, the high volume of pending UST transactions is due to network sluggishness and congestion. Acknowledging the potential inconvenience to its investors, Binance said:
“Binance will reopen withdrawals for these tokens once we consider the network stable and the amount of pending withdrawals is reduced. We will not notify users in further announcements.”
Crypto Twitter, however, reacted to Binance’s announcement by questioning the underlying values of decentralization for the crypto community – the move has been compared to the centralized approach usually played by traditional finance.
Hmm… reminds me a lot of our shiny legacy financial system. https://t.co/yF11hj4i5N
— ergo whale (@ergo_whale) 10 May 2022
As users around the world are barred from withdrawing their own funds, the community reiterated the phrase “your keys not your coins” and Binance’s funds as one of the major cons of a centralized crypto exchange. Highlight suspension.
On the other hand, some members of the community backed the move, saying that Binance CEO Changpeng “CZ” Zhao helped a number of investors liquidate themselves by selling the stablecoin at $0.7.
While Terra continues to find a sustainable solution to the declining value of UST, several crypto entrepreneurs including Polygon co-founder Sandeep Nelwal show support for Do Kwon, co-founder and CEO of TerraForm Labs.
I haven’t followed the LUNA/UST ecosystem or community discourse much, but at the founder to founder level, I can get a feel for it @stablekwon
He is at the center of this industry-wide event handling so much pressure and responsibility at such a young age.
— sandeep — use spline on polygon (@sandeepnailwal) 10 May 2022
Good luck to him and the Luna community!
related: Terra’s UST overtakes BUSD to become 3rd largest stablecoin
On April 18, UST flipped Binance USD (BUSD) to become the third largest stablecoin on the market after Tether (USDT) and USD Coin (USDC) by market capitalization.
Cointelegraph’s report, based on data collected from Coingecko, showed that the total market capitalization of USTs has increased by 15% over the past 30 days to nearly $17.5 billion, slightly higher than BUSD’s market cap of $17.46 billion. Was.
However, as a result of the recent turmoil in the Terra ecosystem, BUSD has regained its position as the 9th largest cryptocurrency by market capitalization. At the time of writing, UST ranks 10th on the list with approximately $16.5 billion in market capitalization.
