According to a tweet from the Terra blockchain protocol, developers behind the failed stablecoin TerraUSD have chosen to ditch the token in favor of building a new blockchain and digital asset weeks after the cryptocurrency crashed.
TerraUSD’s value was created by complicated computational procedures, connected to another matched token called Luna, unlike most other major stablecoins that are backed by other assets. Since TerraUSD, or UST, fell below its 1:1 peg to the dollar earlier this month, both tokens have lost virtually all of their value.
Developers will establish a new Terra blockchain with a resurrected Luna coin as part of the Terra ecosystem’s recovery plan.
Terra Classic will be the name of the original blockchain, while Luna Classic will be the name of the original Luna coin.
The new Luna coin will be distributed by Terra supporters to Luna Classic and UST holders. Terra said in a tweet that it will collaborate with Binance and Bybit to deliver the new asset to holders of Luna Classic and UST on exchanges.
“Our community will always be our strength, and this is the clearest indication of our resiliency yet.” In a tweet, Terra stated, “We can’t wait to begin our work together inventing the future of money.”
TerraUSD had a market worth of more than $18.5 billion and was the tenth-largest cryptocurrency prior to its crash on May 9. Its market capitalization is now hovering around $1 billion.