LIVE💔BREAKING The LUNA Saga: From Heights to Depths 🚀♥️
In May 2022, $LUNA, once soaring at $116, plunged to a heart-wrenching $0.00008 by June 6, leaving investors in disbelief.
What caused this catastrophic crash that wiped billions off the Terra and Luna ecosystem, valued at over $60 billion?
Let's dive into the roots of Terra Network and Luna, founded in 2018 by Do Kwon and Daniel Shin.
Their vision? A decentralized payment system using stablecoins pegged to real-world currencies, like UST tied to the U.S. dollar and KRW linked to the Korean won.
Central to this ecosystem was LUNA, the native token managing blockchain fees. Unlike traditional stablecoins backed by real money, Terra opted for an algorithmic approach.
Enter the UST example: Users could burn $1 worth of LUNA to create 1 UST or vice versa.
This mechanism aimed to keep UST close to $1, encouraging users to burn LUNA for UST when its value exceeded $1 and vice versa.
For over a year, this model maintained stability, regulating UST supply based on demand.
However, the calamity unfolded in May 2022 when UST crashed significantly below $1, triggering a system-wide collapse.
It wasn't a mere glitch; it was a devastating freefall, resulting in substantial losses for investors, traders, and long-term holders.
The $LUNA saga serves as a stark reminder of the crypto market's unpredictable nature. Learn, adapt, and navigate wisely. 🌌💡
