The cryptocurrency, designed to maintain a value of US$1, fell as low as US$0.30 on Wednesday, according to CoinMarketCap data, as traders lost faith in its ability to keep its peg to the U.S. dollar. (The Logic)
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The cryptocurrency, designed to maintain a value of US$1, fell as low as US$0.30 on Wednesday, according to CoinMarketCap data, as traders lost faith in its ability to keep its peg to the U.S. dollar. (The Logic)
Talking point: TerraUSD’s troubles underscore the risks of algorithmic stablecoins, which are meant to keep their peg through financial engineering, unlike more traditional stablecoins backed by cash reserves. While it’s unclear exactly what caused the coin to lose its peg, the drop occurred alongside a massive cryptocurrency selloff that prompted Bitcoin’s price to fall below US$30,000. The crypto market is now waiting for TerraUSD’s creator to step in with a rescue plan for the coin. And the drama around TerraUSD isn’t the only sign of crypto trouble: Coinbase stock fell roughly 25 per cent in early trading Wednesday after its first-quarter earnings revealed drops in user numbers, trading volume and assets. The stock is now down more than 75 per cent this year.
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