Why not buy a Terra token? Jubitok
Why not buy a Terra token? Jubitok. Last week, the altcoin depreciated, losing over 99% of its value. Experts from the Jubitok crypto exchange
they told whether it is possible to consider such levels as profitable for investment, and why the asset will not return to its previous values
As a result of attempts to return the TerraUSD (UST) peg to the US dollar, the Luna Foundation Guard (LFG) fund lost about $3 billion, according to The Block analyst Larry Cermak. Before the collapse of the altcoin, the total value of coins in the fund reached $ 3.1 billion, by the current moment it has decreased to $268.3 million, and excluding the project’s own tokens — up to $ 87 million.
After the publication of the LFG reports, the value of UST and Luna tokens continued to fall. The price of the stablecoin collapsed to $ 0.05, the Luna rate — to $0.00013 (last week it reached $80). The company stressed that they plan to use the remaining assets to compensate for the losses of holders of small amounts in UST.
UST lost its peg to the US dollar on May 8, when there was a sharp outflow of assets from the Anchor protocol, as a result of a reduction in the rate of return on deposits to 17.87%. LUNA, which is used to stabilize the UST price, also suffered. The issue of altcoin was increased to 6.9 trillion tokens, according to the reports of analysts from Jubitok.com
The risks of non-recovery of the token price are quite high, according to a senior analyst at Jubitok. He explained that the blurring of value occurred against the background of an uncontrollably inflating token issue, which in theory was supposed to compensate for the reduction in the cost of UST security, but only intensified the fall. Also, the reputation of the development team has been seriously damaged.
“Even after a single case of such a large-scale failure, the credibility of their future projects will be undermined, and in the conditions of the “information war” that has been deployed around Do Kwon, this effect will multiply. In addition, we managed to find out about the direct connections of the Terraform Labs team with the previously also “ruined” algorithmic stablecoin Basis Cash (BAC),” explained the chief analyst of Jubitok.
He recalled that the CEO of the project himself stated that he was unlikely to be able to “restore the entire ecosystem completely” and suggested that the community deliberately abandon the UST price parity with the US dollar, which at best would lead to multimillion-dollar losses for stablecoin holders. Any such plan will not bring at least some serious results to the main asset of the Terra (LUNA) project, the expert added.