Dear TerraUSD (UST) Crypto Fans, Mark Your Calendars for May 27

  • Amid an incredible implosion for TerraUSD (UST-USD) and Terra (LUNA-USD), various exchanges are pulling support
  • Investors will no longer be able to trade UST on Coinbase (NASDAQ:COIN) starting May 27
  • The future of the Terra network remains broadly uncertain
Stacked Terra (LUNA) crypto tokens.
Source: David Sandron / Shutterstock.com

If investors need more negativity outside the stock market, just take a look at the crypto market. Investors in TerraUSD (UST-USD) and the UST crypto have been on a ride to hell.

UST is a stablecoin that is supposed to be pegged to the U.S. dollar. However, the token has moved off its peg in incredible fashion, now trading around 10 cents apiece. Its sibling token Terra (LUNA-USD) has also crashed to near-zero levels.

Various exchanges aren’t waiting around to cut their losses, even if some investors are “hodling.” This week, major exchanges such as Coinbase (NASDAQ:COIN), Binance and others have delisted both LUNA and UST tokens. In the case of Coinbase, this trading suspension for UST and Wrapped LUNA (WLUNA-USD) is expected to take place on May 27.

Let’s dive into what may be on the horizon for Terra, in light of these headwinds.

Where Does UST Crypto Go From Here?

In many respects, investors could argue that it’s already game over for both UST and LUNA. Experts have said so.

An algorithmic stablecoin ecosystem, Terra was built to redefine how stablecoins work. Rather than backing this stablecoin with U.S. dollars or other hard assets, Terra went an unconventional route supporting UST through a mathematical relationship with LUNA. In 2022 it also added reserves of Bitcoin (BTC-USD) and other cryptos.

But with the whole crypto market tanking, UST found little support and lost its peg. This stablecoin may be DOA, marking a rather significant event for crypto maxis. However, Do Kwon and the Terraform Labs team have concocted a plan to relaunch Terra 2.0 later this month as well.

Whether the new Terra gets listed on prominent exchanges or not remains to be seen. Indeed, a significant amount of reputational damage has been done. For now, investors will need to wait until the end of the month to learn more. For now, I think anything tied to Terra is simply too risky to consider.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.


Article printed from InvestorPlace Media, https://investorplace.com/2022/05/dear-terrausd-ust-crypto-fans-mark-your-calendars-for-may-27/.

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