On Could 13, Terra’s UST algorithmic stablecoin slumped as little as 23 cents, and the LUNA token, created to stop the UST algorithmic stablecoin from being unstable, fell 96% at one level. An algorithmic stablecoin is one which in concept maintains its peg utilizing solely software program and guidelines, which means it’s not essentially backed by collateral. As an alternative, the token’s programming, or sensible contract, can enhance provide if the worth is falling or scale back provide if the worth is rising.
