The company’s affiliate after the collapse of stablecoin TerraUST said on Monday it had spent large sums of money trying to secure a dollar anchor last week, and would use the rest to try to compensate other missing users.
The signal crash last week sent cryptocurrencies to collapse, a slide that resumed on Monday, as bitcoin delivers gains over the weekend The world’s largest cryptocurrency fell 5 percent to $ 29,700 on Monday in Asian trading, sliding and stocks are concerned about rising prices and rising interest rates.
Bitcoin has lost about one-fifth of its value so far this month, such as the dramatic collapse of TerraUST, which is expected to put 1: 1 to the dollar but now trades at about 14 cents, around the crypto markets.
The Luna Foundation Guard (LFG), a Singapore-based nonprofit designed to protect TerraUST, said on Twitter on Monday it would use its remaining assets to pay for the remaining users of the so-called stablecoin, starting with the youngest owners, albeit making a decision. the best way to do that.
The organization has built a huge reserve including more than 80,000 bitcoin and millions of dollars worth of other stablecoins to support TerraUST, many of which it said was spent trying to support the brand last week.
The LFG had earlier promised to raise $ 10 billion in bitcoin. The stock was down to 313 bitcoin and other assets as of now, tweeted.
Read also: Bitcoin eyeball records record loss as ‘stablecoin’ crashes crash crypto
Eye crypto controllers
The event drew some attention, including financial regulators, to stablecoins and the role they play in the cryptosystem as a key way to transfer money between cryptocurrencies or convert their balance into fiat cash.
Bank of France Governor Francois Villeroy de Galhau said a conference on crypto assets could disrupt the international financial system if it is not regulated and co-operated in a way that is consistent and appropriate for all jurisdictions.
He pointed to stablecoins, and said that they were somehow misused, as among the sources of risk.
Speaking on the contrary, Fabio Panetta, a member of the executive board of the European Central Bank, also said on Monday that stablecoins were in danger of running out.
Tether, the world’s largest stablecoin, briefly lost 1: 1 pin on May 12, before recovering. Unlike TerraUST, Tether is backed by resources from traditional assets, according to its operating company.
On the same day, bitcoin dropped to $ 25,400, the lowest level since December 2020, but has been restored to $ 31,400 on Sunday.
Ether, the second largest cryptocurrency, fell 5.6pc to $ 2,000 on Monday.
Authorities elsewhere are also concerned.
The US Federal Reserve warned last week that stablecoins were at risk of losing an investor because they were backed by assets that could lose value or become illiquid in times of market pressure.