With the Luna crypto crash seeing Luna and TerraUSD collapse, holders are left wondering whether a Luna recovery is possible. Do Kwon, TerraLabs CEO and founder, proposed a Luna recovery plan to stabilize the current crypto wreckage during the crash. It comes on the heels of talk of Luna’s delisting from exchanges and trade suspensions.
Terra halted its blockchain on Thursday evening after validators decided to try and prevent governance attacks as the severe inflation of LUNA reduced the cost of attack for bad actors.
“The Terra blockchain was officially halted at a block height of 7603700,” TerraUSD said in a Twitter post.
“Validators are applying a patch to disable further delegations, and they will coordinate to restart the network in a few minutes,” said Terra’s official page.
In what is believed to be a coordinated attack on the Terra ecosystem, LUNA crashed to below half a cent on Thursday while UST went severely off its peg. Since holders of UST can redeem 1 UST for $1 worth of LUNA, arbitrageurs have been repeatedly buying $UST at a discount and minting LUNA before selling for the profit on the difference. In four days, LUNA’s supply went from 340,000,000 to over 42,000,000,000 at the time of writing.
Terra’s blockchain resumed on Thursday evening shortly after it was halted.
Image via Shutterstock
Several hours ago Do Kwon released the Terra Ecosystem Revival Plan, proposing to launch a fork of the Terra chain to make the ecosystem whole from the UST depegging event. The proposal was met with a controversial reaction from the crypto community.
In the Revival Plan he stated:
“As of this time, there are still several billion dollars worth of UST, and the value of Luna token has fallen to essentially zero. Even if the peg were to eventually restore after the last marginal buyers and sellers have capitulated, the holders of Luna have so severely been liquidated and diluted that we will lack the ecosystem to build back up from the ashes. While a decentralized economy does need decentralized money, UST has lost too much trust with its users to play the role.
So what remains? While UST has been the central narrative of Terra’s growth story over the last year, the Terra ecosystem and its community is what is worth preserving.”
It appears that Terra Ecosystem Revival Plan is focused on salvaging Terra ecosystem and its community as a first priority. Meanwhile, prospects for UST look rather grim at this time. Does Terra Labs have enough motivation to save UST and LUNA?
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