LUNA Sinks As Binance Suspends Withdrawals Of Tokens Amid Market Turmoil

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  • The de-pegging of the UST stablecoin from the U.S. dollar has caused chaos on Satoshi Street.
  • Tuesday morning, the UST price fell to $0.60, a 40 percent depeg from the USD.
  • This has led to large liquidations of UST and Terras native coin, LUNA.
  • As a result, Binance chose to suspend withdrawals of LUNA and UST tokens because of a significant volume of pending withdrawal transactions caused by network congestion.
  • Tuesday morning, Asia time, traders observed that the orderbook for the two stablecoins appeared locked, with no orders being executed.
  • LUNA is a victim of the ongoing cryptocurrency bloodbath. LUNA bulls are following the red tide as daily losses reach 14 percent.
  • Similarly, the asset has experienced a 34% decline over the course of seven consecutive days.
  • According to the most recent price estimates from CoinMarketCap, UST has lost its dollar peg for the second time in three days, falling to $0.65 on Monday.
  • As of press time, LUNA has shed 60% of its value, retreating to under $25 for the first time since September last year.
  • Binance says the suspension of withdrawals is only temporary.
  • On May 9, Luna Foundation Guard (LFG), a Singapore-based nonprofit that was formed to support both Terra-based stablecoins and the broader Terra ecosystem, announced a plan to lend $1.5 billion worth of Bitcoin (BTC) and UST to third-party trading firms in order to provide support for USTs peg.
  • However, the price of UST has continued to fall relative to that of USDT.
  • The depegging appears to begin with a series of significant withdrawals from Anchor Protocol, a lending market that provides high rewards to users who deposit UST.
  • Large amounts of UST were also removed from liquidity pools on Curve, a decentralized finance (DeFi) network that enables users to trade between stable currencies like as UST.
  • A single wallet dumped $84 million worth of UST on the Ethereum blockchain and $108 million on the Binance cryptocurrency exchange, adding a whiff of conspiracy to the previous days events.
LUNA LUNA Sinks As Binance Suspends Withdrawals Of Tokens Amid Market Turmoil
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