Terraform CEO Announces Plan to Save UST
Main page News, Stablecoins

Do Kwon, CEO of Terraform Labs, has just presented a plan to restore the price of the algorithmic stablecoin UST, which has resulted in the price of LUNA surpassing $1.

At the moment, the UST price is hovering around $0.59. Over the past 24 hours, the crypto has seen a 21% rise.

Kwon has said:

"The price stabilization mechanism is absorbing UST supply (over 10% of total supply), but the cost of absorbing so much stablecoins at the same time has stretched out the on-chain swap spread to 40%, and Luna price has diminished dramatically absorbing the arbs."

According to him, a necessary step before taking further action will be to absorb the supply of UST holders who wish to dispose of the asset.

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The objective of the plan is to accelerate the pace of LUNA's launch. Under the mechanism, 1 UST should be available for exchange at any time for $1 in LUNA. According to Kwon, this "will allow the system to absorb the UST more quickly."

He has added:

"Naturally, this is at a high cost to UST and LUNA holders, but we will continue to explore various options to bring in more exogenous capital to the ecosystem & reduce supply overhang on UST."

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