The UST stablecoin, created by the Luna Foundation, has faced a significant devaluation in the crypto market since last Monday (9). The token’s price plummeted from US$ 1 to US$ 0.30 recently.
The UST devaluation has further affected the bitcoin price, which has once again been quoted below US$ 30,000 in the past 24 hours. Considered an algorithmic stablecoin, UST has collapsed on the market, further causing a huge devaluation of Terra (LUNA).
Currently, Terra (LUNA) is valued at US$ 2 on the crypto market, and has accumulated a devaluation of over 95% as of Wednesday (11). During the UST price instability, the Luna Foundation decided to sell US$ 1.5 billion in bitcoins, seeking to repurchase the crypto asset to stabilize the price of the platform’s stablecoin.
However, this move may have resulted in bitcoin falling over three days. Now, bitcoin is priced at around US$30,000 on the crypto market and has accumulated a weekly depreciation of 19.5%.
UST and Terra prices plummet on the market
According to Coindesk, the US$ 1.5 billion sales of Luna Foundation funds may have caused a selling pressure of bitcoins on the market, which has affected the price of the crypto asset.
Although it has depreciated to US$ 0.2998, UST has regained some of its market value, and on Tuesday morning (10) the stablecoin was being quoted at US$ 0.4564. Therefore, more than 50% below the ideal value for the token with 1:1 parity with the dollar.
Thus, in search of stabilizing the UST, Terra’s price has dramatically dropped in the market. For example, in the past 24 hours alone, the LUNA price has fallen by more than 96%.
As CoinMarketCap data shows, the crypto asset recently hit US$ 0.8384 after starting a dizzying drop over the past three days.
In the past week alone, LUNA has shown price swings between a low of US$ 0.8384 and a high of US$ 87.96. That is a variation of more than 10,000%.