Binance halts trading of Luna and UST in most of its spot pairs after meltdown – TechCrunch

Binance, the world’s largest cryptocurrency exchange, is set to end trading Terraform Labs’ Terra (Luna) and TerraUSD (UST) tokens on its platform after one of the industry’s biggest meltdowns.

The exchange indefinitely suspended trading of Luna and UST for most of its spot pairs on Thursday evening after the tokens lost nearly 100% of their value over the span of days. In addition, it freezes Luna trading on all pairs of crossed margins and isolated margins.

The move, which follows the exchange drawing support for futures contract trading for the Luna token earlier on Thursday, comes as Terraform Labs increased its circulating supply of Luna tokens to more than 6.5 trillion, an increase from 386 million three days ago (according to Terrascope, a Terra statistics tracking tool) in an effort to push its sister token, a supposed stablecoin, to regain its 1-to-1 peg to the dollar.

Updating: Shortly after the publication of this story, Terraform Labs said it has shut down the Terra blockchain and is working to “devise a plan to put it back together”. It is the second time the Terra blockchain has been frozen today. Earlier on Thursday, Terraform Labs shut down the network for a while to prevent possible hacks.

TerraUSD, a so-called algorithmic stablecoin, aims to be a substitute for the dollar by interweaving with Luna, which has no fixed value. The plan is that if the value of TerraUSD drops below $1, it can be “burned” and exchanged for Luna worth a dollar, and vice versa.

But when TerraUSD fell below $1 earlier this week, the reason for which has yet to be confirmed, that algorithmic plan was tested and failed.

The loss of confidence from the crypto community and aggressive panic selling caused Luna’s price to plunge to $0.000011, from around $80 earlier this week. The value of UST was 3 cents at the time of publication.

Terraform Labs is struggling to find ways — including reportedly trying to raise money — to fix the situation, but so far it hasn’t had any luck.

The change in value of UST this week. (Image and data: Binance)

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