TerraUSD dollar peg rocked by weekend dump, LUNA drops 20% |

The crowdfunding platform Terra raised $1.5 million in an ICO at the end of 2017, but its dollar peg to gold has been met with criticism and cries for a pump-and-dump scheme by its investors – until now. LUNA is taking the brunt of this controversy after it released plans to list on NASDAQ under suspicion that Terra’s announcement was false advertising.

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The “ust losing peg” is a problem that the TerraUSD dollar peg has been experiencing for the past few weeks. The currency lost its dollar peg on Saturday, causing a drop in value of 20%.

Hundreds of millions of dollars of UST were dumped on Curve Finance this weekend, May 7th, in what seemed to be a concerted assault on the Terra ecosystem. This coincided with a jump in short interest in Terra Luna and a spike in Twitter traffic, which resulted in “Ponzi” being a worldwide trend for a few hours.

Several Crypto Twitter accounts shared images of the instant UST fell below Several accounts on Crypto Twitter posted tweets with screenshots of the moment UST dropped below $0.992 as breaking news that the dollar peg had broken down. Some even declared it a “moment in history.”.992 as breaking news that the dollar peg had broken down. It was even dubbed a “moment in history” by some.

The TerraUSD dollar peg has broken down. After Luna loaded up on #Bitcoin, she’s in free fall. pic.twitter.com/jvOcD4QKeb

Dennis Porter (@Dennis Porter_) on Twitter 8 May 2022

The massive de-pegging, however, seems to have been short-lived, as seen by the current price of UST on Binance.

UST pegTradingView through the LUNAUSD Trading Pair

As “someone began selling UST in bulk, it started to de-peg,” the trading volume on Curve soared to three times that of Uniswap. However, this was greeted with strong opposition, and the peg was reinstated,” according to a Curve statement.

DegenSpartan was one of the first to detect the Curve difficulties, as well as a $2 billion decline in Anchor’s locked assets from $14 billion to $11.7 billion. It has plunged even further following the tweet, reaching its lowest point since January. In a single day, two wallets withdrew a total of $372 million from Anchor.

luna tvlAnchor Protocol (source)

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“Btw, if yall females are going to fud, please do it during my awake hours,” Do Kwon said in response to the happenings. For crying out loud, Terra Chain is open 24 hours a day, seven days a week.” He also shared the following on Twitter:

The assault on Terra-Luna-UST today was well-planned and executed. A single player dumped 285 million UST on Curve and Binance, followed by large shorts on Luna and hundreds of tweets. Simple staging. Someone is bothered by the project. You’re on the correct track!

May 8, 2022 — Caetano Manfrini (@CaetanoManfrini)

Some have interpreted this as a successful network stress test, demonstrating that even extreme volatility only brought the peg down 0.7 percent before the algorithm caught up. CryptoHarry, a fundamental analyst, said,

The bad guys realized that today was their final opportunity to de-peg $UST before the 4pool incentives kicked in. While liquidity is shifting from 3pool to 4pool, no credible seller will sell 500 million $UST. It’s illogical.

As a consequence of the activity, the overall supply of LUNA increased significantly for the first time in months, with 581,984 LUNA minted. This is one of the reasons why the price of LUNA has dropped in the last 24 hours. The price dropped to $59 before rising to roughly $66. LUNA has dropped 25% at its lowest point due to the UST instability.

luna supplySmartStake (source)

Was this a coordinated assault, or did investors just leave when the yield fell? Is there a snowball effect from the Crypto Twitter barrage of negativity? Although the data is still being processed, TerraUSD is the world’s third largest stablecoin by market capitalization. In the following tweet, a researcher from Alongside DeFi detailed the events:

This seems to be what occurred:

-Massive $UST sell-off on Curve -Rumors soon spread on Twitter -Leads to a $2 billion $UST withdrawal on Anchor -Price of $LUNA sinks – $UST depeg to 0.987 -Peg straight up to 0.995 following Do Kwon tweet -Jump selling assets to acquire $UST

May 8, 2022 — Route 2 FI (@Route2FI)

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The “ust depeg” is a dollar peg cryptocurrency that has been rocked by a weekend dump. LUNA, the token for TerraUSD, dropped 20% in value over the weekend.

Related Tags

  • how could ust lose its peg
  • how does ust maintain peg
  • luna ust risk
  • stablecoin crashes
  • luna price

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