Minting Freeze for USTC Approved
The value of USTC, a stablecoin ranked 200th among thousands of cryptocurrencies, has surged by 4% in the past day, reaching $0.0127 per coin. Previously, USTC maintained a solid peg to the US dollar at $1 per unit until May 2022 when it deviated from this peg and never returned.
Despite the downturn in the Terra blockchain ecosystem, a community of users and developers persisted. The Terra blockchain enables trading between USTC and LUNA, causing LUNA’s supply to skyrocket into trillions. A governance motion has been proposed to halt the minting process of USTC through software adjustments.
The motion, endorsed by 59.42% of participants, aims to close loopholes and stop minting and reminting of USTC without approval from the Terra Classic community. The proposal also includes measures to re-peg USTC to the US dollar and burn the USTC supply with participation from the Terra Classic community.
The community remains optimistic about re-anchoring USTC to the US dollar, prioritizing the protection of investors involved in burning USTC to achieve the repeg. While USTC is valued at $0.012 per coin, LUNA’s valuation is significantly lower at $0.00006206 per unit.
Hot Take: Re-Pegging USTC to USD Holds Promise Amidst Market Challenges
The approval of the minting freeze for USTC reflects a determined effort by the Terra Classic community to address challenges faced by the stablecoin and re-establish its peg to the US dollar. With support from participants and plans for burning the USTC supply, there is optimism surrounding the potential for a successful re-anchoring process.
However, the significant decrease in LUNA’s valuation highlights the volatility and risks associated with cryptocurrencies. It serves as a reminder of the unpredictable nature of the crypto market and the need for cautious investment strategies.
Overall, the governance motion represents a step towards stability and restoring confidence in USTC, showcasing the resilience of the Terra ecosystem and its commitment to addressing issues within its blockchain.
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