- Terra's LUNA price and UST suffered a colossal crash and lost over $39.2 billion in market cap, fueling outrage among holders.
- A Terra holder filed a police complaint against Do Kwon, revealing thousands of Singapore investors are victims of the death spiral.
- The Korean National Tax Service has imposed $78.4 million in corporate and income tax on Do Kwon and Terraform Labs.
The collapse of Terra's LUNA price and algorithmic stablecoin TerraUSD (UST) has sparked outrage in the crypto community. Institutions and retail investors suffered significant losses when $40 billion in LUNA and UST’s market value was destroyed within a week. Do Kwon, CEO of Terraform Labs, is in the midst of all the anger, and legal issues are starting to surround him.
Also read: Why Do Kwon plan to recover LUNA price is not sitting well with Terra community
Terra’s LUNA price death spiral
The crypto community witnessed the first “crypto bank run” in history when both Terra's LUNA price and UST crashed, wiping out nearly $39.2 billion in market value within a week. UST, Terra’s algorithmic stablecoin, suffered a de-peg, losing its $1 parity, and is trading at $0.08 at the time of writing. Likewise, Terra’s native token LUNA plummeted from $77 to $0.000001 within a week.
LUNA and UST three-day chart
In a series of tweets, the Luna Foundation Guard revealed that it had transferred 52,189 BTC to “trade with a counterparty” as UST fell below its intended $1 peg. This was an attempt to reestablish the algorithmic stablecoin’s peg. Terra directly sold 33,206 BTC in a last-ditch attempt to defend UST’s peg, to no avail. Terra’s blockchain was halted several times on and thereafter, and LUNA and UST were delisted from multiple cryptocurrency exchanges, including Binance and Coinbase.
1/ As of Saturday, May 7, 2022, the Luna Foundation Guard held a reserve consisting of the following assets:
· 80,394 $BTC
· 39,914 $BNB
· 26,281,671 $USDT
· 23,555,590 $USDC
· 1,973,554 $AVAX
· 697,344 $UST
· 1,691,261 $LUNA— LFG | Luna Foundation Guard (@LFG_org) May 16, 2022
