Binance, the largest crypto exchange in the world, has removed all trading pairs for LUNA, Terra and UST.
Playground announced on the delisting of the LUNA cryptocurrency and the UST stablecoin. On Friday, May 13 at 00:40 UTC, the Terra ecosystem tokens were removed from the margin and spot markets. The crypto exchange warned users on Thursday to exclude the LUNA and Tether (USDT) trading pair if the price falls below $0.005.
Earlier this week, Binance suspended UST and LUNA withdrawals due to network congestion caused by a high volume of pending withdrawal requests. On the afternoon of May 12, data CoinMarketCap, LUNA is trading at $0.00003, down 99.97%. UST – at $0.16, from fall by 70%.
UST is an algorithmic stablecoin. Unlike USDT and USDC, algorithmic stablecoins are not backed by real assets, instead they are managed by self-executing smart contracts. LUNA was intended to help stabilize the UST on its dollar peg through a mint-and-burn mechanism – when, for example, 10 LUNAs are exchanged for their UST equivalent and burned, that is, taken out of circulation.
The mechanism came under pressure this week and the UST began to lose its dollar peg. As investors rushed to sell their UST and LUNA en masse, the cryptocurrency began to be issued in large quantities, which led to hyperinflation. And also to the dissatisfaction of LUNA sellers, which accelerated the collapse of quotations.
Recall that on May 12, the cryptocurrency companies Citadel, Gemini and BlackRock denied rumors of involvement in trading operations that provoked the weakening of the UST peg to the US dollar.