Terra USD's Creator Has Big Aspirations For The Coin

2022-05-17 | Selina Mathew

Terra USD's Creator Has Big Aspirations For The Coin

The plan's centerpiece is a software fork, which entails taking current code and replacing it with an upgraded version.

On May 16, the price of the stablecoin TerraUSD plummeted after the cryptocurrency's founder announced a strategy to save the project.

According to CoinMarketCap, the price of TerraUSD, which was meant to preserve a dollar-like value, was down 36% at 11 cents. Trading volume was less than $400 million in the last 24 hours, down from more than $5 billion last week.

The market value of TerraUSD has dropped to $1.3 billion from roughly $19 billion earlier this year.

Last week, TerraUSD saw a catastrophic crash as a result of the broader market selloff, plummeting much below its $1 value. The drop placed downward pressure on bitcoin and other cryptocurrencies, and TerraUSD's sister currency, Luna, lost value. TerraUSD, being an algorithmic stablecoin, relied on Luna to maintain its $1 value.

According to CoinMarketCap, Luna was trading at $0.0002 on May 16th, down 15%. According to CoinMarketCap, its entire market value was over $1.4 billion on May 16. Luna reached a high of $41 billion earlier this year.

Do Kwon, the token's creator, revealed what he called a Terra restoration plan on the afternoon of May 16th.

The plan's central idea was to perform a "fork" in software, which entails taking old code and replacing it with an upgraded version.

The new version would eliminate the algorithmic stablecoin and award 1 billion additional Luna tokens to existing Luna and TerraUSD holders and developers.

On the same day, the organization Luna Foundation Guard, which handled the reserve fund that supported the stablecoin, released a report detailing the remaining reserves after TerraUSD's collapse. The gang holds 313 bitcoins, which are worth around $9.3 million at current pricing.


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