\n
Placeholder while article actions load<\/title><\/div>\n<div class=\"teaser-content grid-center\">\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">When two cryptocurrencies crashed roughly three weeks ago, the effects were devastating. Their collapse sparked over <a target=\"_blank\" href=\"https:\/\/www.washingtonpost.com\/business\/2022\/05\/16\/crypto-crash-regulations\/?itid=lk_inline_manual_2\" rel=\"noopener\">$500 billion<\/a> in losses in the broader crypto market. Numerous investors saw their life savings evaporate. Others contemplated suicide. People called for criminal investigations into the company behind it all and government regulation for the larger market.<\/p>\n<\/div>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">But now the team behind the failed coins are back at it. On Saturday, Terraform Labs, the start-up behind TerraUSD and its sister cryptocurrency Luna, which both dropped to nearly zero in value, started trading a new digital coin that is part of their revival strategy, referred to as Luna 2.0.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">\u201cA chance to rise up anew from the ashes,\u201d Do Kwon, founder of Terraform Labs, wrote <a target=\"_blank\" href=\"https:\/\/agora.terra.money\/t\/terra-ecosystem-revival-plan-2-passed-gov\/18498\" rel=\"noopener\">in his plans<\/a> announcing the new cryptocurrency.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">The coin replaces the old Luna cryptocurrency and trades under its ticker symbol, LUNA. Investors who lost money in Terraform Labs\u2019 previous coins may get some new tokens free, based on a ratio determined by the company. The old Luna coin can still be traded, but under a new name, called Luna Classic. It\u2019s listed as LUNC on crypto exchanges.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">The new Luna coin has gotten off to a rocky start, tumbling over 75 percent in value during its first hours, and regaining some of it in subsequent days. As of Tuesday evening, the coin was trading at just above $8.50 \u2014 or roughly half the price it started at, <a target=\"_blank\" href=\"https:\/\/www.coingecko.com\/en\/coins\/terra\" rel=\"noopener\">according to Coin Gecko<\/a>, a website that tracks cryptocurrency prices.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">But amid its ups and downs, the release has drawn fierce scrutiny from cryptocurrency analysts, investors and critics. It highlights a broader issue with the cryptocurrency market, they said: Companies can sell what they want with little worry about regulation or enforcement \u2014 putting everyday investors most at risk.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">\u201cIt\u2019s the little guy who\u2019s being sold false promises [and] who\u2019s getting absolutely torn apart by this,\u201d said <a target=\"_blank\" href=\"https:\/\/www.washingtonpost.com\/technology\/2022\/05\/29\/molly-white-crypto\/?itid=lk_inline_manual_12\" rel=\"noopener\">Molly White<\/a>, a software developer who runs the website <a target=\"_blank\" href=\"https:\/\/web3isgoinggreat.com\/\" rel=\"noopener\">Web 3 Is Going Just Great<\/a>. \u201cIt\u2019s just an enormous failure on the part of regulators.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">A Terraform Labs spokesperson said the decision to launch a new cryptocurrency was made with large support from its community and that the company looks forward to what the future holds.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">In 2018, Kwon \u2014 a Stanford University-trained engineer \u2014 started Terraform Labs, aiming to transform modern financial systems. That year, he created the Luna cryptocurrency. In 2020, the company started selling TerraUSD, calling it a stablecoin. (These coins typically peg their value to a safer asset, like the U.S. dollar.)<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Unlike other stablecoins on the market, Kwon\u2019s TerraUSD was a riskier project, experts said. It was not backed by a reserve asset, like cash. Rather, it used an algorithm to maintain its value of around $1 by linking it to the supply of Luna currency.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">For a time, the Luna cryptocurrency skyrocketed in value, creating a community called \u201cLunatics.\u201d In early April, it reached slightly over $116 in value. But in early May, for reasons that are still unclear, cryptocurrency investors started dumping TerraUSD in droves, causing it to lose its peg to the dollar, and spiraling Luna\u2019s value out of control.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">In the following days, the value of Luna and TerraUSD kept plummeting, ultimately losing $60 billion in value and causing over $500 billion in losses to the broader cryptocurrency market, industry data shows.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Numerous investors were furious, posting on sites like Reddit, Discord and Twitter, about how they put all their savings into Luna and TerraUSD only to see it vanish in days. Some posted about their intention to kill themselves. In Taiwan, <a target=\"_blank\" href=\"https:\/\/www.taiwannews.com.tw\/en\/news\/4551502\" rel=\"noopener\">media reports<\/a> indicate a man killed himself after seeing $2 million in Luna currency plummet to roughly $1,000.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">But last week, amid fierce scrutiny from lawmakers and crypto industry critics, Terraform Labs announced its plans to launch another cryptocurrency as part of its \u201crevival strategy.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Terraform Labs said it would \u201cairdrop\u201d or provide new Luna tokens to many people who lost money at the rate of 1.03 Luna coins for every Luna Classic they held, <a target=\"_blank\" href=\"https:\/\/medium.com\/terra-money\/terra-2-0-luna-airdrop-calculation-logic-3eb752c25837\" rel=\"noopener\">the company said.<\/a><\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">A number of cryptocurrency investors voiced their anger and intention to <a target=\"_blank\" href=\"https:\/\/twitter.com\/TheCryptoLark\/status\/1530839517858439168\" rel=\"noopener\">not hold onto<\/a> the new coin.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<div data-oembed-type=\"twitter\" class=\"\" style=\"min-height:171px\">\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">Zero plans to buy <a target=\"_blank\" href=\"https:\/\/twitter.com\/search?q=%24luna&src=ctag&ref_src=twsrc%5Etfw\" rel=\"noopener\">$luna<\/a> 2.0, but I will dump any airdrop if I get something on Binance.<\/p>\n<p>\u2014 Lark Davis (@TheCryptoLark) <a target=\"_blank\" href=\"https:\/\/twitter.com\/TheCryptoLark\/status\/1530839517858439168?ref_src=twsrc%5Etfw\" rel=\"noopener\">May 29, 2022<\/a><\/p><\/blockquote>\n<\/div>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Matt Hougan, the chief investment officer of crypto asset management firm Bitwise, said his company has no intention of investing in the new coin. \u201cWe wouldn\u2019t touch Luna 2.0 with a 10-foot pole,\u201d he said in an interview.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Hougan said he does not believe stablecoins that use algorithms to keep their value can work. Rather, they need to be backed by an asset. He also believes that the new Luna coin will do little to resuscitate Kwon and Terraform Lab\u2019s reputation within the broader community of crypto investors.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">\u201cThe collapse thoroughly damaged confidence in the team,\u201d he said. \u201cI suspect there\u2019s just no coming back from it.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Hougan, however, said there could be a silver lining. Similar to 2018, when there were numerous cryptocurrency scams around initial coin offerings that prompted government scrutiny, he believes the same might happen with stablecoin regulation in the coming months.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">\u201cI suspect what comes out of this process is more regulations on the stablecoin front,\u201d he said. \u201cMore enforcement actions from the SEC. And a stronger crypto industry as a result.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Meanwhile, White, of Web 3 Is Going Just Great, said Kwon\u2019s ability to mint a new cryptocurrency so soon after his previous project failed so prominently is a failure of the broader regulatory and enforcement mechanism in the crypto world. \u201cYou can just keep doing what he\u2019s doing,\u201d she added. \u201cAnd that\u2019s exactly what he\u2019s doing.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">Still, she remains doubtful any broad action will happen against Kwon, even though South Korean and American regulators are looking into the collapse.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"font-copy font--article-body gray-darkest ma-0 pb-md\">\u201cIt strikes me as unlikely that they would take any sort of broad action against these types of things,\u201d she said. \u201cOr any action that would actually be more impactful than just sort of whack-a-mole.\u201d<\/p>\n<\/div>\n<section class=\"b bt bc-offblack dn-ns hide-for-print\" \/><\/div>\n<p><br \/>\n<br \/><a href=\"https:\/\/www.washingtonpost.com\/technology\/2022\/06\/01\/terraform-labs-crypto-luna\/\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Placeholder while article actions load When two cryptocurrencies crashed roughly three weeks ago, the effects were devastating. Their collapse sparked over $500 billion in losses in the broader crypto market. Numerous investors saw their life savings evaporate. Others contemplated suicide. People called for criminal investigations into the company behind it all and government regulation for […]<\/p>\n","protected":false},"author":1,"featured_media":18555,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[36],"tags":[4565,4432,8646,8647,357,8645,356],"class_list":["post-18554","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency","tag-creators","tag-critics","tag-cryptocurrrencies","tag-furious","tag-luna","tag-relaunch","tag-terra"],"jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"http:\/\/egrowonline.com\/wp-content\/uploads\/2022\/06\/PQ2IITXBAII6ZLTENMR6KFK3MI.jpgw1440.jpeg","_links":{"self":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/18554","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=18554"}],"version-history":[{"count":1,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/18554\/revisions"}],"predecessor-version":[{"id":18556,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/posts\/18554\/revisions\/18556"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=\/wp\/v2\/media\/18555"}],"wp:attachment":[{"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18554"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18554"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/egrowonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18554"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}