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TerraUSD developers voted to create a new blockchain without a failed stablecoin – News | New world

A smartphone with the Terra logo is placed above the US dollars shown in this illustration taken on May 11, 2022. The illustration was made on May 11, 2022. REUTERS/Dado Ruvic/Illustration/Files

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May 25 (Reuters) – The developers of the failed TerraUSD stablecoin voted to abandon the token in favor of creating a new blockchain and digital asset weeks after the cryptocurrency crash, according to a tweet from the Terra Blockchain Protocol.

Unlike most other major asset-backed stablecoins, TerraUSD was valued through complex algorithmic processes pegged to another paired token called Luna. Both tokens have lost almost all of their value since TerraUSD, known as UST, fell below its 1:1 peg against the dollar earlier this month.

As part of the plan to restart the Terra ecosystem, developers will create a new Terra blockchain with a revived Luna token.

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The original blockchain will be renamed Terra Classic and the original Luna token will be called Luna Classic.

Terra members will distribute the new Luna token to Luna Classic and UST holders. In a tweet, Terra stated that it will work with crypto exchanges Binance and Bybit to distribute the new asset to people who hold Luna Classic and UST on the exchanges.

“Our strength will always be in our community, and today is the clearest sign of our resilience. We look forward to resuming our work together to build the future of silver,” Terra wrote in a tweet.

Prior to the crash on May 9, TerraUSD had a market capitalization of over $18.5 billion and was the tenth largest cryptocurrency. Its market cap is now hovering around $1 billion.

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Reporting by Hannah Lang in Washington; edited by David Evans

Our Standards: Thomson Reuters Trust Principles.

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