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Terra is doing everything it can to reduce the circulating supply of stablecoin UST. This is aimed at recovering the price for this token after the LUNA crash.
Today, May 12, the market witnessed the lowest price of UST in history. Terra posted an article on Twitter listing emergency measures to “rescue” the UST. Consists of:
- Proposal to burn the remaining UST in the community group.
- Burn remaining 371 million cross-chain USTs on Ethereum.
- Put 240 million USD LUNA to protect from network admin attacks.
Earlier on May 11, Terraform Labs CEO Do Kwon announced that he would release more LUNA to the market to buy back UST.
According to Terra’s estimation, the measures taken will help remove more than 1.3 billion UST from the current total supply of 11.8 billion UST of this stablecoin. The Terra community will soon vote on the proposal.
Blockchain administrator Terra says the company is looking to burn through the UST it has accumulated from “subsidizing” UST. The circulating supply of LUNA has increased from 400 million LUNA to 3.4 billion LUNA in the last 72 hours.
A tragic week for UST, the stablecoin has had to fight since Sunday (May 8) to recover its $1 fixed price. At that time, the stablecoin fell to $0.985.
This “catastrophe” dragged LUNA down 10% at the time and today, LUNA really collapsed. LUNA has lost more than 99.7% of its value in the past few days.
At the present time, the afternoon of May 12, LUNA is trading at 0.06 USD. Meanwhile, the price of UST is fluctuating at $0.50, still lower than the $1 threshold it must return to.
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