Terra’s USTC Stablecoin Suddenly Rises 800% In One Week

USTC Dies Rising Orphan

The USTC was de-pegged in May after users massively withdrew from Anchor Protocol, a lending and borrowing platform that provides up to 20% return to customers depositing UST into the venue. As of June 15, this token is almost worthless, trading at just $0.005.

But the USTC started to recover later, almost reaching $0.1 billion on June 29. At the same time, the capitalization increased from $65 million to $767 million over the same period, according to data from CoinMarketCap.

This came despite USTC’s abandonment after Terra launched its new blockchain featuring new parent asset LUNA 2.0 via “hard fork” in May.

Having not stopped there, the old version of LUNA 2.0, known as LUNA, now operating as Terra Classic (LUNC), also saw market valuations jump similar to USTC, rising from around $160 million to $767 million in June.

Pump Terra comes in a large, concentrated volume.

According to CoinMarketCap, more than 45% of the volume traded when USTC and LUNC prices exploded originated from KuCoin, a centralized trading platform believed to be operating from Seychelles.

KuCoin’s leading facilitator is NEO Global Capital (a Singapore-based venture capital firm) which has also been exposed to financial platforms such as Babel Finance and CoinFLEX. Both are facing liquidity troubles due to the continued decline in the cryptocurrency market.

“This is not a boom-and-bust cycle again,” warns InvestmentU, a financial analysis team, on June 28, that LUNC could plunge because “the technology behind it is dead.”

“LUNC has no reason to exist, and so does its price. While we can appreciate investors’ natural desire for superior returns, there are better ways to do so. ”

The outlook for USTC is also bleak as it fails to perform its primary function of providing customers with a stable, digital version of the US dollar.

Crypto Bull tweeted:

“This is a game for whales. Dump in due course. All new entrants lose money”

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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