It looks like Bitcoin ‘Moon boys’ have finally gotten to the promised land of over $100,000 per BTC as the Binance BTC/UST peg hit $138,000 per token. UST, which was meant to be a stablecoin pegged to the U.S. dollar 1:1 has lost its peg as it currently trades below 30 cents, losing over 70% of its value in the last 24 hours.
Due to the depegging of UST, it has caused all tokens paired against it to astronomically rally in price. This is why the BTC/UST peg hit $138,000 per token as UST lost its peg due to market conditions that threw the mechanisms of the programmable stablecoin off balance.
TerraUSD (UST) is the decentralized and programmable stablecoin of the Terra blockchain and was created to deliver value to the Terra community and offer a scalable solution for DeFi amid severe scalability problems faced by other stablecoin leaders
What you should know
- FUD (Fear, Uncertainty and Doubt) has appeared to set in on crypto markets overnight as Blockchain protocol Terra failed to steady its bleeding cryptoassets.
- Other assets like ETH/UST also hit a high of over $10,000 a token as the depegging continues.
- After a mass sell-off which some argued was “coordinated” to destroy the Terra ecosystem, UST lost its peg to the U.S. dollar.
- Attempts to shore up the peg with both LUNA and Bitcoin (BTC) reserves failed, and as uncertainty gripped the market, both UST and LUNA dived to levels unimaginable just days previously.
- Terra blockchain Co-founder Do Kwon said that a “recovery plan” was due for release, details of this plan is yet to be released as of the time of writing.
- There are also rumors circulating online that are suggesting that other major crypto firms may be willing to contribute funds to support the peg.
- Despite potential sell pressure on Bitcoin itself and other crypto asset classes, however, the largest cryptocurrency had avoided a fresh dip below $30,000 at the time of writing, as it struggles to stay above $31,000.
- LUNA, the native token of the Terra blockchain is down over 90% in the last seven days as it currently trades below $5 per token. A little over a month ago, LUNA hit an all-time high of $119.18.
In just a month, LUNA has erased over $37 billion of its market capitalization, one of the faster ever declines in the cryptocurrency space. It also lost its top 10 ranking by market capitalization as it currently ranks #34 with a market capitalization of $2.1 billion.
UST, as a result of its depegging, has lost its position has the token largest stablecoin, to currently rank #5, with a market capitalization of $7.2 billion.