Terra, one of the largest cryptocurrencies, crashed almost 99% overnight, falling below a dollar and the move wiped out 95% of investors’ wealth. The reason for this is the UST debugging of the Terra Blockchain.
At the moment, the price of Terra (LUNA) is trading at $0.0000557, down 99.97% in the last 24 hours.
However, the crypto market is now relieved as the bulls are gearing up a bit with the global crypto market trading at $1.30 trillion in the last 24 hours with a growth of 16.25%.
GAM to back UST’s peg
Amid negative price action for Terra (LUNA), Swiss asset manager GAM Holding announced that the firm is in talks with TerraForm Labs, the Terra developer to back its UST stablecoin.
The news comes as Terra was seeking help from private capital to support its UST peg. Blockchain has reportedly benefited around $1.5 billion.
Now GAM could invest between $2 billion and $3 billion to burn off excess supply of UST after the token dump. This offer from GAM is meant to help Terra restore its peg against the US dollar.
In a press release, GAM stated that the main reason for its UST support is that it sees some potential in the Terra ecosystem and also believes that UST’s algorithmic system will regain its peg.
Terra Blockchain Halts
The Terra blockchain has today halted for the second time in the past 12 hours after Terra’s native token LUNA fell below $1 and the UST stablecoin lost its dollar peg. The reason for the closure is that developers are asking for more time to determine a recovery plan.
The Terra blockchain experienced its first halving yesterday, May 12, for almost two hours, in order to prevent any regime attack caused by the LUNA price crash 100%.
Still at this point in time, the network is down and no further streamlining is being done by the developers.