TerraUSD (UST) everyone’s eyes and ears Do Kwon, founding CEO of TerraIt was converted to .
Finally, the expected move from Kwon came and Kwon revealed his bailout plan for UST. The rescue plan in question brought the tragedy of “Lehman Brothers” to the minds of the community.
Kwon proposed major changes to the Luna/UST balance design to speed up the absorption process of TerraUSD (UST) stablecoins.
To share the details of emergency proposal 1164, Twitter head Kwon discussed the unique pegging of the TerraUSD (UST) stablecoin.
He said a 57% “discount” could be applied to his currently targeted peg at the equivalent of $1.
According to Kwon, there is no other choice but to aggressively destroy the UST tokens that are leaving the market. This, in turn, will increase the UST price and bring the USD closer to its normal 1:1 ratio.
Therefore, Do Kwon proposed increasing the protocol’s “print capacity” from $293 million to the equivalent of $1.2 billion. He stated that this will help speed up the token burning process.
LUNA’s algorithmic stablecoin, which changed hands at around $66 on May 8, has started to slide downwards as it lost the $1 rate.
UST continued its decline yesterday, forcing many other major cryptocurrency exchanges, notably Binance, to halt withdrawals.
Tweeting about 24 hours ago that he was close to announcing a recovery plan for UST, Do Kwon said:
First of all, the only way forward would be to absorb the supply of stablecoins that want to exit before $UST starts to stabilize again. There is no way to get around this.
said.
Kwon added, “Naturally this comes at a high cost for UST and LUNA owners, but we will continue to explore various options to bring more external capital into the ecosystem and reduce the supply spike in UST.” said.
Compared to Lehman Brothers
Even if the price miraculously managed to return the stablecoin to $1 thanks to Do Kwon’s suggestions, the reputation and trust in UST took a huge hit.
Many derided Do Kwon’s rescue plan. The lived process Lehman BrothersHe compared it to the situation that caused the financial crisis in 2008.