Binance, the world’s largest cryptocurrency exchange by volume, has suspended trading of Terra (Luna) and TerraUSD (UST) Terraform Labs tokens in most of its spot pairs, and for Luna additionally in all cross-margin and isolated margin pairs following one of the largest crashes in history cryptocurrencies.
run overwhich follows the exchange’s withdrawal from supporting trading in Luna token futures contracts earlier Thursday comes as Terraform Labs increased the number of Luna tokens circulating to more than 6.5 trillionup from 386 million three days ago (according to Terrascope, a tool that tracks Terra’s statistics) in an attempt to push its sister token, the putative stablecoin, to regain its 1:1 peg to the dollar.
TerraUSD, the so-called algorithmic stablecoin, aims to replace the dollar, instead exchanging it for Luna, which has no fixed value. The idea is that if the value of TerraUSD falls below $1, it can be “burned” and exchanged for Luna worth a dollar, and vice versa.
But when TerraUSD fell below $1 earlier this week, a loss of faith on the part of the crypto community also caused Luna’s price to plummet from around $80 over the weekend to $0.0000011 at press time. At the time of publication, the value of UST was 3 cents.
Terraforms Labs has been struggling to find ways, including reportedly trying to raise money to resolve the situation, but has so far been unsuccessful.
Credit: techcrunch.com /