Developers behind failed stablecoin TerraUSD have voted to abandon the token in favour of making a new blockchain and digital asset a week after cryptocurrency started to collapse, according to a tweet from the Terra blockchain protocol.
And unlike other major stable coins that are supported by other assets, TerraUSD’s worth was derived by complex algorithmic processes, connected to another paired token called Luna. Both tokens had also lost nearly all of their value since TerraUSD, recognized as UST, slipped it below 1:1 peg to the dollar earlier in the month.
Developers will establish a new Terra blockchain with a recovered Luna token as part of the Terra ecosystem’s recovery plan. The initial blockchain will be changed its name Terra Classic, while the original Luna token will be called Luna Classic. Terra backers will transfer the new Luna token to Luna Classic and UST handlers.
In a twitter post, Terra also said it would work with crypto exchanges Binance and Bybit to transmit the new asset to people who held Luna Classic and UST on exchanges.
Previous to its collapse on May 9, TerraUSD had a stock price of more than $18.5 billion and was the 10th cryptocurrency. Its current valuation is now hovering at around $1 billion.