Terra’s $40 billion experiment to build a functional “algorithmic stablecoin” project has largely failed since its collapse in May.
Nevertheless, its native stablecoin TerraClassicUSD (USTC), formerly called TerraUSD (UST), has been flourishing over the past week.
walking dead stationary
In short, UST lost its US dollar peg in May following a massive withdrawal from Anchor Protocol, a lending and lending platform offering clients up to 20% yield on their UST deposits. As of June 15, the token was virtually worthless, trading at $0.005 on the Kraken crypto exchange.
But USTC later began to recover, so much so that the value per token reached around $0.10 on June 29. Also, its capitalization increased from $65 million to $767 million in the same period, according to data from CoinMarketCap.
USTC is operating as an abandoned token after Terra launched a new blockchain with a new native asset LUNA 2.0 following a “hard fork” in May.
Interestingly, the older version of LUNA 2.0, called LUNA, which now operates under the name “Terra Classic (LUNC), has also seen its market valuation increase like USTC’s, which peaked at around $160 in June. million to $767 million.
Mass Concentrated Terra Pump
According to CoinMarketCap, more than 45% of the trading volume behind the astonishing price jump of USTC and LUNC originated from KuCoin, a centralized exchange platform reportedly based out of Seychelles.
A major backer of KuCoin is NEO Global Capital, a Singapore-based venture capital firm with exposure to financial platforms such as Babel Finance and CoinFLEX. Both the platforms are facing liquidity issues due to the ongoing crypto market collapse.
“This is not a boom, bust and boom again cycle,” InvestmentU warned a financial analytics group in its June 28 note, adding that LUNC could decline largely because “the technology behind it is dead. “
“It’s (LUNC) raison d’etre has been vanquished. And so has its price. While we can appreciate the natural desire of investors for outlandish profit, there are better ways to go about it.”
RELATED: Terra’s LUNA2 Skyrocketed 70% in Nine Days Despite Consistent Selling Risks
The approach appears to be similar for USTC, which has failed to perform its main function, namely providing a digital, stable version of the US dollar to customers.
It’s a game to dump the whale next time ️ All newcomers lose money
– crypto bull[@_Crypto_Bull] 29 June 2022
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