Terra is about to be removed from circulation 1.3 billion UST

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2022-05-14 02:10:22

Terra (LUNA) is doing everything it can to reduce the circulating supply of stablecoin UST.

Terra is about to be removed from circulation 1.3 billion UST

Regarding the cause of the LUNA – UST incident, readers can see CHK’s series of reports here:

In a notice posted on the afternoon of May 12, Terraform Labs announced new measures to “rescue” UST.

In addition to increasing the amount of LUNA issued to the market to buy back UST, as announced by CEO Do Kwon yesterday, Terraform Labs today proposed 3 new changes to the project, including:

– Burn all remaining UST in the community fund.

– Burn 371 million USTs circulating on the Ethereum network in liquidity reward pools.

– Staking 240 million LUNA to prevent the network from being attacked.

Terraform Labs estimates these measures will remove more than 1.3 billion UST from circulation, representing 11% of the stablecoin’s current total supply of 11.8 billion UST. The Terra community will soon vote on the proposal.

In addition, the blockchain management unit Terra also announced that it is looking to burn the amount of UST they have accumulated over the past few days from “subsidizing” UST. In the last 72 hours, the circulating supply of LUNA has increased from 400 million LUNA to 3.4 billion LUNA.

The LUNA price meanwhile has suffered heavy damage, losing more than 99.7% of its value in the past days and is currently trading at just $0.08.

1D graph of the LUNA/USDT pair on Binance at 04:00 PM on 12/05/2022

Meanwhile, the price of UST is hovering at $0.6 at the time of writing, still well below the $1 threshold it must return to.

1h chart of UST/USDT pair on Binance exchange at 04:00 PM on 12/05/2022

Synthetic CHK

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