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Swiss Asset Manager GAM Looks Forward To Back Terra’s UST Peg! Will LUNA Reclaim $1?

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Swiss Asset Manager GAM Looks Forward To Back Terra’s UST Peg! Will LUNA Reclaim $1?

Terra, which was among the largest cryptocurrencies, has dropped below $1 crashing by almost 99% overnight and this move has wiped out 95% of investors’ wealth. The reason is the Terra blockchain’s UST depegging.

At the moment, Terra (LUNA) Price is trading at $0.0000557 with a crash of 99.97% over the last 24hrs.

However, the crypto market has now found relief as the bulls are slightly gearing up with the global crypto market surging by 16.25% over the past 24hrs trading at $1.30 trillion.

GAM To BAck UST’s Peg

Amidst the negative price action of Terra (LUNA), Swiss asset manager GAM holding announced that the firm is negotiating with Terraform Labs, the Terra developer to support its UST stablecoin.

This news comes as Terra was looking out for help from private capital to support its UST peg. The Blockchain has reportedly gained around $1.5 billion.

Now GAM could possibly invest between $2 billion and $3 billion in order to burn oversupply of UST after the token gets dumped. This offer from GAM is to help Terra restore its peg against the US dollar.

In a press release, GAM stated that the prime reason for its UST support is that it sees some potential in the Terra ecosystem and also believes UST’s algorithmic mechanism will reclaim its peg.

Terra Blockchain Halts

After Terra’s native token LUNA bottomed below $1 and the UST stablecoin lost its dollar peg, the Terra blockchain gets halted for the second time in the last 12 hours today. The reason for the discontinuation is that the developers are seeking more time to set a recovery plan.

The Terra blockchain has officially halted at block 7607789.

Terra Validators have halted the network to come up with a plan to reconstitute it.

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More updates to come.

— Terra (UST) 🌍 Powered by LUNA 🌕 (@terra_money) May 13, 2022

Terra blockchain experienced its first halt yesterday, 12th May for about two hours in order to prevent any governance attack due to the LUNA price crash of 100%.

Even now at the moment, the network is down with no further streamline being made by developers.

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Qadir AK

Qadir Ak is the founder of Coinpedia. He has over a decade of experience writing about technology and has been covering the blockchain and cryptocurrency space since 2010. He has also interviewed a few prominent experts within the cryptocurrency space.

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Will Burning Excess LUNA tokens Really Impact the Price After it Failed Miserably with SHIB & ETH Price?

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Will Burning Excess LUNA tokens Really Impact the Price After it Failed Miserably with SHIB & ETH Price?

The Shiba INU platform to stabilize the SHIB price had earlier introduced a burn mechanism after Ethereum’s ETH 2.0 with EIP 1559 upgrade went operational. However, the burn mechanism does not appear to have fueled the price rally as both SHIB price and ETH price are drowning in the same bearish well, despite the fact that the tokens continue to burn as per the algorithm. 

Recently, Shiba INU recorded a milestone of burning nearly 12.6 billion SHIB tokens in a day worth nearly $123,551. Despite the burn rate spiked by more than 5000% yet, the price remained largely un-impacted. A similar instance has been recorded with the ETH price. According to the burn portal, more than 2,340,000 ETH has been burnt since its inception. Moreover, the burnt tokens were far ahead of the tokens issued on the same day. 

Therefore, when the burn mechanism has not led to any major impact on the second-largest token, Ethereum and the most popular memecoin Shiba INU, How fine will it be for the LUNA price?

As the entire community currently is after burning the excess minted tokens when UST got heavily de-pegged. LUNA tokens in circulation are closely related to the UST’s peg. As the stablecoin lost its peg, new LUNA tokens were minted and flooded into the market. The circulating supply sky-rocketed from just 1.46 billion to as high as 6.53 trillion at the press time. This impacted the price heavily which is around $0.000134 and hence the community is constantly asking to burn the tokens instead of a fork or LUNA V2. 

Considering the previous history of very popular tokens, which were merely impacted by the burn mechanism, burning LUNA tokens may also not be the one-stop solution to stabilize the LUNA price. And hence the team behind the tokens may have to have a strong plan to stabilize both LUNA and UST prices at the same time. 

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Sahana Vibhute

A passionate cryptocurrency and blockchain author qualified to cover every event in the crypto space. Researching minute occurrences and bringing new insights lie within the prime focus of my task.

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Pantera Capital Sold 80% LUNA Tokens Before Massive Crash!

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Pantera Capital Sold 80% LUNA Tokens Before Massive Crash!

Pantera Capital, one of Terraform Labs’ most prominent supporters, sold out over 80% of its Terra (LUNA) investment before the currency’s fall last week.

In a recent interview with The block, Joey Krug, co-chief investment officer at Pantera Capital, told :

“The market has been fairly frothy over the last year and thus we’d exited the majority of our position before any of this happened,” “Roughly 80% over the last year, fairly gradually over time.”

Pantera Capital-backed Terraform Labs at least twice, first with a $25 million round in January 2021 and again with a $150 million ecosystem fund round in July 2021. Following the publication of the report, Krug noted that Pantera’s LUNA investments were distinct from its Terraform Labs investments and occurred in the summer of 2020, following LUNA’s initial public offering.

He said :

“We managed that position down over time as it became increasingly profitable/large, in order to maintain a diversified portfolio,”. “We initially invested in LUNA because of the progress we saw in developer adoption, the payments usage, and the broader ecosystem being built on Terra.”

Pantera made a huge profit since it liquidated the majority of its investment early. Pantera Capital partner Paul Veradittakit told The Block that the business transformed $1.7 million into about $170 million.

Meanwhile, other Terraform-backed venture capital businesses are suffering losses as Terra’s native LUNA token has lost nearly all of its value owing to the UST crisis.

Pantera liquidated much of its LUNA assets from the remaining 20% stake after it learned of UST’s de-pegging the week before.

“We got out of 2/3 of that at an average price of $25.6,” said Krug. “The remainder of that was staked via LUNAX and so unable to be sold.” Stader Labs’ LunaX is a liquid staking token.

Is Anchor Protocol a Best Investment?

Veradittakit has encouraged people to invest in Anchor, a Terra-based decentralized banking network that, like UST, has lost virtually all of its client assets.

According to statistics from Defi Llama, Anchor’s total value locked (TVL) has dropped from over $16 billion before the UST meltdown to just over $150 million currently. The anchor was described by Veradittakit as a “savings account” with a high “fixed” interest rate.

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“20% APY [annual percentage yield]. A fixed-income, low-risk financial instrument with returns as high as Anchor is truly incredible,” Veradittakit had said in a Medium blog post in April 2021.

Anchor gave UST depositors a 20% annual percentage yield. Anchor contributors recently advocated decreasing the APY to an average of 4% in order to make its yield reserves more viable due to the UST problem.

On Wednesday, around 7:30 a.m. ET, the fork suggestion went public. Over 84 million LUNA have voted in support, with over 9 million voting against at the time of writing. To pass, the vote requires 188 million LUNA in favor.  Pantera’s LUNA investments have been updated for transparency.

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Implosion Of Tether Is Closer Than Ever! Fears Over USDT Downfall Loom – Here’s Why

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Implosion Of Tether Is Closer Than Ever! Fears Over USDT Downfall Loom – Here’s Why

Tether’s USDT market valuation has decreased by nearly $9 billion after Terra’s UST meltdown. The market saw a dramatic sell-off last week as a result of the collapse of Terra’s UST stablecoin, with USDT trading as low as $0.95.

Tether’s “implosion” was approaching, according to the crypto analyst known for his opposing viewpoints. This is perhaps not surprising coming from an expert who has already criticized Tether’s ethics. What was more concerning was a graph depicting Tether’s declining market cap.

Indeed, as of press time, USDT’s market capitalization had plummeted to levels last seen in December 2021. Even though USDT’s market value ranking did not change, this is a worrying warning for investors. Tether, meanwhile, was trading at $0.999 at the time of publication.

As if that weren’t enough, Tether supply on exchanges has increased by more than two billion in recent days, with a particularly sharp increase of stablecoins returning to the markets since early May.

Which is the New Go-To Stablecoin?

While much of this happened around the time Tether was briefly de-pegged, the trend has continued, and Tether supply on exchanges has reached new highs.

Another interpretation is that investors are taking their USDT to the exchanges to buy the dip and leave with shiny new alts. Glassnode noted that,

“If we look to the supply of USDT, we can see that indeed, over $7.485 Billion worth of USDT has been redeemed with week. The total USDT supply declined from near the $81.237B ATH to $75.75B.”

Meanwhile, according to Glassnode’s study, crypto investors may be reconsidering their preferred stablecoin.

“Given the dominant growth of USDC over the last 2yrs, this may be an indicator of changing market preference away from USDT and towards USDC as the preferred stablecoin.”

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