Terra

Terra (LUNA) is a public blockchain protocol that emerged from Terra Classic. Due to limited liquidity, LUNA sell orders will not be accepted from 10:51 PM - 11:11 PM CT. Please submit your orders outside of this window.

On Thurs. May 25, Terraform Labs announced that the Terra community had approved the creation of a new blockchain, Luna 2.0. The creation of this new chain is a response to unprecedented volatility on the Luna 1.0 chain, which caused the price of the original LUNA and UST to collapse almost to zero. 

As part of the migration, the former asset LUNA will become Luna Classic, or LUNC. A portion of LUNA holders will be eligible to receive an airdrop of the new token (LUNA), per the terms outlined by Terraform Labs.

The new Terra blockchain will utilize the new LUNA, and will not include the UST stablecoin. 

On 9 May, after nearly 18 months of steadily holding its value against the US dollar, the so-called stablecoin TerraUSD (UST) became unpegged. The uncoupling triggered a cascade response that ultimately crashed UST and the Terra (LUNA).

TerraUSD (UST) is a stablecoin, which means it is a cryptocurrency pegged to a fiat currency. In this case, it is designed to be pegged to the US dollar. Stablecoins are intended to allow investors to hold crypto assets with less volatility, and trade a dollar equivalent without needing to cash out their positions. 

UST is considered an algorithmic stablecoin because instead of being backed by assets such as cash or cash equivalents, it is supported by on-chain code that facilitates a change in the supply and demand between UST and LUNA.

LUNA is the cryptocurrency that works in unison with UST in an effort to keep UST in 1:1 parity with the US dollar. One dollar of LUNA can always be converted at a 1:1 ratio to 1 UST. 

For example, if LUNA is trading at $10, then it can be redeemed for 10 UST, and 10 UST can be redeemed for 1 LUNA. If UST rises above its $1 peg to $1.01, then traders can swap 1 USD of LUNA for 1 UST. This trade burns 1 LUNA and mints 1 UST, which can then be sold for 1.01 USD. 

If UST rises to $1.02, then traders can sell for a 2 cent profit, and so on. 


In theory, increasing the supply of UST and lowering the supply of LUNA brings the price of UST back down until it reaches $1. Conversely, if UST drops below the $1 peg, then traders will be incentivized to buy 1 UST for 0.99 USD, which can then be swapped for 1 LUNA. 

This move burns UST and mints LUNA, sending UST higher towards the $1 peg.

UST lost its peg to the dollar starting on May 8th following large withdrawals of UST from Terra’s DeFi protocol Anchor. UST fell quickly, and struggled to regain its peg because the burning of UST and minting of LUNA couldn’t keep up. 

UST descended rapidly as the prolonged de-pegging led to uncertainty and a snowball effect of larger withdrawals. 


A significant share of circulating UST was locked on Anchor, a Terra-based lending and borrowing protocol that paid users 19.5% to stake UST. 

The LFG used up about $2.9 billion of its bitcoin reserves in an unsuccessful attempt to revive UST. 

WSJ 
Decrypt 
Bloomberg

*This content is for educational purposes and is not investment advice.

The arrest comes after the country invalidated Terra co-founder Do Kwon's passport.

South Korea Arrests Terra's Head of General Affairs Yu: Report

In other developments, South Korea has arrested a suspect in connection with Terra's collapse on charges of fraud and a breach of duty concerning market manipulation.

Do Kwon's Passport Voided — But On-the-Run Entrepreneur Says Seized $40M Crypto is Not His

South Korean authorities have reportedly made the first arrest in the ongoing investigation of the Terra ecosystem collapse.

'Key Aide' to Terra's Do Kwon Arrested by South Korean Authorities: Report

The Seoul Southern District Prosecutors' Office has reportedly arrested a Terraform employee named Yu, making its first arrest in the case. The post South Korea makes first arrest in Terra case, JTBC reports appeared first on The Block.

South Korea makes first arrest in Terra case, JTBC reports

South Korean authorities have reportedly frozen $40 million in crypto assets, including bitcoin, allegedly belonging to Luna founder Do Kwon. However, Kwon denied that any funds of his have been frozen. “I don't even use Kucoin and Okex, have no time to trade, no funds have been frozen,” he insisted.

South Korea Reportedly Freezes Do Kwon's Crypto Worth $40M — Luna Founder Says the Funds Are Not His

Do Kwon has 14 days to return his passport, according to a notice on a government website.

Terra Founder Do Kwon's Passport 'Invalidated,' S. Korea Says

The beleaguered TerraForm Labs CEO Kwon Do-hyung, also known as Do Kwon, denied reports on Wednesday that South Korean prosecutors have frozen Bitcoin (CRYPTO: BTC) assets worth 56.2 billion won ($39.6 million) of Terra Luna Foundation. South Korea's News1 reported that on Sept.

Terra CEO Do Kwon Denies Reports Of Frozen Bitcoin

"I don't know whose funds they've frozen, but good for them," Terra co-founder Do Kwon wrote on Twitter.

Terra's Do Kwon Denies Reports That Authorities Froze $39.6M of His Crypto

Terra's Do Kown Denies Reports That Authorities Froze $39.6M of His Crypto

What's backing MakerDAO's decentralized stablecoin DAI? Mostly other coins—and about five years of uninterrupted existence.

Terra's Collapse Destroyed Faith in Stablecoins. Can Maker Restore It?

Traders are optimistic as they await official numbers from the major exchange.

Terra's Luna Classic Gains Big as Binance Burns Untold Tokens

Ethereum

The co-founder of Ethereum (ETH) says the implosion of stablecoin issuer Terra (LUNA) earlier this year dealt a big blow to the decentralization of crypto.

Terra (LUNA) Collapse Big Step Backward for Crypto Decentralization: Ethereum (ETH) Creator Vitalik Buterin

Terraform Labs is reportedly accusing South Korean authorities of giving in to public pressure when they issued a warrant of arrest against its founder Do Kwon. Kwon currently faces legal actions following the crash of the cryptocurrency Terra (LUNA) and the stablecoin TerraUSD (UST).

Terraform Labs Calls South Korean Prosecutor's Case Against Founder Do Kwon ‘Highly Politicized': Report

Terraform Labs accused South Korean prosecutors of overreaching their authority, the Wall Street Journal reported Wednesday. The post Terraform Labs says South Korea's Luna case is ‘highly politicized': WSJ appeared first on The Block.

Terraform Labs says South Korea's Luna case is ‘highly politicized': WSJ

A Terraform spokesperson claimed that its Luna cryptocurrency wasn't a security, meaning it wasn't covered by South Korea's capital-markets law.

Terraform Labs Calls Korean Authorities' Arrest Warrant for Do Kwon Overreach: Report

Amid reports that the Luna Foundation Guard [LFG] moved 3,313 Bitcoin (CRYPTO: BTC), worth over $69 million, to two crypto exchanges outside South Korea after an arrest warrant was issued for Do Kwon, the beleaguered Terra blockchain founder on Wednesday claimed he had not used the platforms in nearly a year. Interpol issued a red alert for Kwon's arrest earlier this week, due to his involvement in the collapse of the Terra ecosystem.

Terra-Founder Do Kwon Refutes Reports Of Cashing Out Shortly After Arrest Warrant Issued

Authorities in South Korea are reportedly seeking to freeze over $60 million in Bitcoin with ties to Do Kwon and the collapsed Terra project.

Do Kwon, Luna Foundation Gaurd Deny Link to $62M in Bitcoin Sought by Authorities

The Luna Foundation Guard has issued its own denial — and says that no new wallets or Bitcoin transfers have been performed since May 2022.

Do Kwon Denies Attempting to Cash Out $67M in Bitcoin After Arrest Warrant Issued

“When a token goes from 20 cents to $100 and you don't take profit, that's lunacy,” the CEO of Galaxy Digital said.

Luna Investors Failed to Appreciate the Risks, Novogratz Says

Bitcoin

South Korean prosecutors are seeking to freeze 3,313 bitcoins at two cryptocurrency exchanges allegedly tied to luna founder Do Kwon. The coins were moved soon after a South Korean court issued an arrest warrant for the Terraform Labs co-founder. Luna Foundation Guard has denied transferring the coins.

South Korea Seeks to Freeze 3,313 Bitcoin Allegedly Linked to Luna Founder Do Kwon

The LFG refuted claims from a CoinDesk report that indicated a wallet was set up for the LFG on Binance this month. The post Luna Foundation Guard denies reports it moved bitcoin appeared first on The Block.

Luna Foundation Guard denies reports it moved bitcoin

The international policing organization Interpol is officially requesting that law enforcement worldwide help locate and arrest the embattled Terra (LUNA) founder Do Kwon, according to a new report. Bloomberg notes that South Korean prosecutors in Seoul confirmed Interpol has placed a “red notice” on Kwon.

Prosecutors Say Embattled Terra (LUNA) Founder Do Kwon Now on Interpol Red Notice: Report

In a new turn of events surrounding the beleaguered founder of Terra (CRYPTO: LUNA) blockchain Do Kwon, who has a red notice issued against him by Interpol, Luna Foundation Guard [LFG] moved 3,313 Bitcoin (CRYPTO: BTC) totaling more than $69 million to two cryptocurrency exchanges located outside of South Korea. This apparently took place immediately after Kwon's arrest warrant was issued on Sept.

Luna Foundation Guard Moved Over 3,000 Bitcoin After Do Kwon's Arrest Warrant: Report

The global law enforcement agency the International Criminal Police Organization (Interpol), issued a notice for Terraform Labs co-founder Do Kwon just a few weeks after a warrant for his arrest was issued by South Korean authorities.

Global Manhunt for Terra Luna Founder Do Kwon After Interpol Issues Red Notice

The crypto exchange's new measure aims to reduce the hyperinflated LUNC token's supply, but it is unlikely to have the desired effect that traders hope for.

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