Terra, the creator of the algorithmic stablecoin TerraUSD (UST) and LUNA, has halted the Terra blockchain.
In a Tweet, Terra.Money stated:
The Terra blockchain was officially halted at a block height of 7603700. lcd.terra.dev/blocks/latest Terra validators have decided to halt the Terra chain to prevent governance attacks following severe $LUNA inflation and a significantly reduced cost of attack.
In a spectacular rout, LUNA crashed to almost zero. LUNA started the day at over $2 but lost more than 99% of its value in the ensuing hours. Perhaps even more dramatic is the fact that LUNA traded at over $119 just last month.
Earlier today, Terra said the peg pressure from UST was “rendering severe dilution” of LUNA. UST is tied to LUNA as the erstwhile stablecoin was able to trade one UST for $1 dollar in LUNA.
1/ The prevailing peg pressure on $UST from its current supply overhang is rendering severe dilution of $LUNA.
The primary obstacle is expelling the bad debt from UST circulation at a clip fast enough for the system to restore the health of on-chain spreads.
— Terra 🌍 Powered by LUNA 🌕 (@terra_money) May 12, 2022
Terra said validators are “applying a patch to disable further delegations.”
A restart is said to be commencing soon.
Could it be the end for UST/LUNA? Some crypto prognosticators have called for UST to shut down. Some have called the whole thing a fraud or a failed experiment. Meanwhile, the founders continue to try and reanimate the zombied crypto. The dust is yet to settle.
Meanwhile, one crypto enthusiast has outlined his belief that the entire odyssey was part of a spectacular plot to make hundreds of millions of dollars = in a few short days.
How to make a >800 million dollars in crypto attacking the once 3rd largest stablecoin, Soros style:
Everyone is talking about the $UST attack right now, including Janet Yellen. But no one is talking about how much money the attacker made (or how brilliant it was). Lets dig in🧵 pic.twitter.com/nGVfqjpVJb
— Onchain Wizard (@OnChainWizard) May 10, 2022
Update: Terra has resumed block production. LUNA is around $0.023 and UST is stumbling around $0.37.
The Terra blockchain has resumed block production.
Delegations are disabled now that the chain is live with the new code merge.
Validators, please check the Discord announcements for the latest patch notes. https://t.co/CGQgfMDWQe
— Terra 🌍 Powered by LUNA 🌕 (@terra_money) May 12, 2022
