LUNA drops to $ 2.10 accompanying UST's performance

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LUNA has seen a long decline as investors rushed to sell The token has lost over the 90% over the course of the day, falling below 2, 00 $ Cryptocurrency markets are seeing the worst of volatility caused by correlation with stock markets, which on the other hand are reacting to the aggressive monetary policy of the US Federal Reserve against inflation. However, some are suffering more than others, and the Earth ecosystem is one such network as it can barely survive in this bear market. Terra’s LUNA token saw large-scale sales as holders rushed to cut losses by selling off the asset. This came after the LUNA / USD pair plunged to single-digit prices, one month after hitting a high of 120 $ at the start of April. CoinMarketCap data shows LUNA is trading at less than 2, 00 $, which means it has lost up to 95% of its value in the last seven days. In the crypto environment there is nothing but talk of this catastrophic fall, and experts take the opportunity to demand adequate regulation. This collapse of one of the most promising tokens is a learning point that the crypto asset class is not yet fully formed despite its rapidly growing popularity. The UST stablecoin is not all that stable The algorithmic Earth stablecoin pegged to the UST dollar was the source of the drama that haunted LUNA, due to the latter’s role in keeping the stablecoin price consistent with the dollar. The race to save UST saw the Luna Foundation Guard distribute $ 1.5 billion (0, 75 billion in FSO and $ 0, 75 billions in BTC) to ease market concerns about the stablecoin and restore the peg. However, the additions still haven’t done much to get everything back to normal. UST took a hit very similar to LUNA, and lost to 50% in the last 24 hours. TerraUSD is currently hovering around 0, 44 $. Consumer protection concerns With all the chaos that has arisen, investors have expressed concern as UST’s backing from crypto assets, including Bitcoin and AVAX, didn’t do much in supporting the stablecoin. As long as UST crashes, it is clear that LUNA will suffer too, staying away from its high price. Regulators will likely take advantage of LUNA and UST capitulations to push the idea that it is absolutely necessary to protect the investor. Treasury Secretary Janet Yellen used the Earth Collapse case in a hearing on Tuesday to discuss why stablecoins need to be regulated. Recovery plan Terraform Lab head Do Kwon took to Twitter today to provide an update on the fiasco after being in silence for 15 hours after promising the community a run for cover. Kwon shared Terra’s recovery strategy which focuses on acquiring stablecoin supply by exiting the market. ” We support the community proposal 1164 to increase the basepool from 50 million to 100 millions of SDRs and decrease PoolRecoveryBlock from 36 to 18. This will increase the minting capacity from 293 million to approximately 1200 million. This should allow the system to absorb the FSO more quicklyWhen we start rebuilding FSO, we will adjust its mechanism so that it is guaranteed “.