How a Crypto Bank Run In Terra’s UST Could Rock Cryptocurrencies

Recently crypto markets saw a downfall with many Cryptocurrencies and digital assets going down in value. Among these cryptocurrencies was the stable coin Terra USD(UST)of the terrablockchainalongwithitssistertokenLunalosingitsvaluefrom82dollarsto17.2dollarsinjust 5days.

A stable coin lost its value following some very unfortunate events. On Saturday the Luna foundation Guard (LFG) which is a non-profit organization supporting the terra blockchain, unintentionally triggered a mega sale of the stable coin worth millions of dollars. This happened because LFG wasremovingUSTvaluingaround150milliondollarsfromthecurve. Do Kwonstated this publicly?

Following this, an unknown address also sold around 84 million dollars in UST which made the demand for UST off balance on the curve. This led to more holders selling stable coins. By midday, the price of the stable coin went down to 95 cents and by evening it had already gone down to 30 percent, from 99 cents to 69 cents. The sister token Luna meanwhile went to 17 dollars from 60dollars which is more than 55 percent of the drop in less than 24 hours.

“Algorithmic stable coins are based on confidence and trust in the economic incentives of the stable coin issuer's underlying ecosystem. Once that trust and investor demand evaporates, they quickly failinadeathspiral,” said Ryan ClemenstoYahooFinancewhodidn’tseemmuchsurprised

by these events. “And we saw that.” Ryan works at the University of Calgary as an assistant professorofBusinessLaw.

TheLunaFoundationGuard(LFG)deployed1.5milliondollars’worthofbitcoinandUSTloanstosave both the cryptocurrencies. Regardless of the future of the stablecoinit’s fair to say that this battle will have alastingimpactonthemarket

John Kramer, who is the head of Defi trading told yahoo finance, “Besides the obvious, real money and people’s livelihoods are at stake, these types of crypto monetary experimentsare important for the evolution of the space,”. “Whether UST ultimately recovers or collapses, itmotivatesotherstobuildmorerobuststablecoinalternatives.”

The whole point of stablecoins is to provide stability in terms of price unlike cryptocurrencies whosenature is to fluctuate on daily basis. Their value is determined by another asset often times which isUSD.Some ofthebiggeststablecoinsaretether(USDT)andCircles’sUSDcoin(USDC).

Crypto Exchange via Kraken

Kraken is the United States-based Cryptocurrency Exchange. Kraken is a cryptocurrency exchange that offers various cryptocurrencies for users to trade. The crypto exchange allows users topurchaseandsellcryptocurrenciesusingvariousfiatcurrencies.krakenalsooffersyoutotradebetweencryptocurrencies.krakenisoneoftheoldestandmost trusted crypto exchange in the

world. It has been there since 2011. It offers trading in more than 175 countries and provides morethan90cryptocurrencies.

HOW TO START

Beginners do significantly well with the Kraken exchange. Trading on the Kraken crypto exchange is fairlyeasy because of the user-friendly interface. Signing up on Kraken is also not complicated at all. You are required to verify yourself and provide legal documents for the same.

Customers need to verify and authenticate themselves, only then they will be able to buy and sell cryptocurrency.

HOW TO TRADE

Kraken is a dynamic cryptocurrency exchange platform. It offers two platforms for both types of customers, beginner or professional. If you are an experienced cryptocurrency trader then you will prefer Kraken Pro and if you are a beginner and new to the digital world then Kraken is your way to go. It offers more than 90 cryptocurrencies and accepts trading in fiat currencies like US dollars, Japanese yen, Canadian dollars, Euro, British pounds, Swiss franc, etc. in over 180+ countries. Some popular currencies available are

· Bitcoin(BTC)

· Ethereum(ETH)

· Cardano(ADA)

· Dogecoin(DOGE)

· Litecoin(LTC)

· Polkadot(DOT)

· Polygon(MATIC)

· Ripple(XRP)

· StellarLumens(XLM)

· Solana(SOL)

· Sushi(SUSHI)

· Uniswap(UNI)

A Kraken trading account or wallet can be made. Kraken offers different modes of transactions like making bank transactions, wired transactions, or digital wallets such as pay-pal, etc. the account management is also quite simple. You can manage your account through a website or app which is everispreferable for you.