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EnglishExplain to me in simple terms the LUNA/UST connection.

1) Why it works the way it does? 2) What was the benefit of burning and producing Luna? 3) Why was Luna a pair interconnected with UST. I don't understand it.

figureskaterx 1 month ago
    Tags:
  • Terra
  • Luna
  • Crypto
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Zakaria 1 month ago
Amid the craziest week in crypto ever, the collapse of Terra's UST stablecoin and governance token LUNA emerged as the biggest story. Amid the crash, LUNA, formerly a top 10 coin by market cap, fell 100% to fraction of a fraction of a cent, and UST, designed to stay pegged at $1, bottomed out at 13 cents.

So what the hell happened? Grab your coffee, you're going to need it.

There were several forces at work. The first is the mechanism behind Terra and its stablecoin. The second was general panic. Many investors-who may have been wholly unaware of
Urbain10 1 week ago
bitcoin IS good
Crebs Park 1 month ago
$LUNA and $UST both belong to the Terra network.

Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned.

It works this way to help maintain the value of $UST which is 1 USD.

The main benefit for burning/producing Luna is to help maintain the stability of the network.
hamzawi 1 month ago
https://www.youtube.com/watch?v=YYi0_bpJfPo
Sampaio Justo 5 days ago
Bom conteúdo
:LoZioZ 1 month ago
Luna's aim was to keep the peg in ust and give voting power in the governance of the Terra chain.
In the Terrastation wallet there is a swap function where you could always burn 1 ust (regardless of its dollar value) to create 1 dollar of Luna out of nothing, this made it so that when the ust peg went below the dollar the people bought and burned ust to make a profit and brought the peg back to $ 1. You could also do the reverse process, that is to burn 1 dollar of Luna to get 1 ust (regardless of its dollar value), this meant that when ust tended to be worth more than 1 dollar, people bought and burned Luna to make a profit. Since burning 1 dollar of Luna you got 1 ust which in that moment of positive depeg was worth more than 1 dollar.
Since in any case it was necessary to burn Luna to create ust, the value of Luna increased proportionally to the adoption of ust. The system collapsed because there was a capital flight that began with a coordinated attack by some billionaires and continued with the panic of the holders, the peg was not maintained due to a saturation limit of the seigniorage system (the procedure seen above) which had a limit per block in the code.
Sorry for bad english.
Uchiha 1 month ago
To peg a stablecoin like TerraUSD (UST), a USD value of LUNA is convertible at a 1:1 ratio with UST tokens. If UST's price is, for example, at $0.98, arbitrageurs swap 1 UST for $1 of USD and make 2 cents. This mechanism increases UST demand and also reduces its supply as the UST is burned. The stablecoin then returns to its peg.

When UST is above $1, say at $1.02, arbitrageurs convert $1 of LUNA into 1 UST and make 2 cents. The supply of UST increases, and demand for UST also decreases, bringing the price back to peg.
Mustapha 1 month ago
You could also do the reverse process, that is to burn 1 dollar of Luna to get 1 ust (regardless of its dollar value), this meant that when ust tended to be worth more than 1 dollar, people bought and burned Luna to make a profit. Since burning 1 dollar of Luna you got 1 ust which in that moment of positive depeg was worth more than 1 dollar.
Sebastián Mena 1 month ago
Terra was created with bitcoin and stable coin (two in one algorithm), if terra low cost, immediately bitcoin are gonna out of this network.
Egbe Peter 1 month ago
$LUNA and $UST both belong to the Terra network.

Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned.

It works this way to help maintain the value of $UST which is 1 USD.

The main benefit for burning/producing Luna is to help maintain the stability of the network.
Shandesh Rai 1 month ago
Luna is gone completely down to zero. I think its not going to make comeback agin.
Michael 1 month ago
UST and LUNA are a dynamic duo behind a growing network of dApps and web2 applications
Djamen Landry 4 weeks ago
$LUNA and $UST both belong to the Terra network.

Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned.

It works this way to help maintain the value of $UST which is 1 USD.
sparrowdigital 4 weeks ago
If you are asking why Ust works the way it does, its because do kwon wanted to have a different approach on stable coins, it works to be equivalent to 1 dollar worth of Luna to 1 dollar of ust...in simple terms to not lose value of assets. 2) since both of them were equivalent to eachother you have to burn 1 Luna to mint(create) 1 ust because they are of the same value, there are too many luna coins, so in order to stabilize ust they have to burn a lot of Luna since the price of ust decreased by 99% 3) luna was a pair with ust because the terra network created it for holders of luna, incase of price fluctuations on falling below a price they didn't want that could swap it without charge and keep it at its holders value as apposed to dropping more.
Ralph80 3 weeks ago
Terra is a blockchain, similar to ethereum and bitcoin. While ethereum's blockchain natively produces ether tokens, terra natively produces luna. In the deys preceeding the depeg, luna become trading at $85.

To create UST, you want to burn luna. So as an example, in early May you may change one luna token for eighty five UST (given that luna became well worth $eighty five), however the luna would be destroyed ("burned") within the method. This deflationary protocol was supposed to ensure luna's lengthy-time period growth. As extra people purchase into UST, more luna could be burned, making the ultimate luna deliver greater valuable.
Vicmar morales 3 weeks ago
Luna es una forma de obtener criptomonedas, el beneficio de luna es que puedes reunir criptomonedas y luego si deseas cambiarlas a usdt o dejarlas allí y esperar que el mercado suba
LB987 3 weeks ago
UST is dead, let's see where Luna 2.0 will go
Makulube 3 weeks ago
TerraUSD was connected to a sister token, Luna, whose cost was set by the market. Since 1 UST was characterized as being equivalent to $1 worth of Luna, that intended that while how much Luna gave over in a trade for UST would fluctuate, a holder of $1 in UST would continuously get $1 in esteem back
Taylor 2 weeks ago
ust stays anchored to around 1 dollar by permanently destroying Luna tokens in order to mint (create) new ust tokens.
Pizzy 2 weeks ago
Terra was created with bitcoin and stable coin (two in one algorithm), if terra low cost, immediately bitcoin are gonna out of this network.
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frias algazzen 2 weeks ago
Thank you for this information. Thank you
winny 2 weeks ago
TerraUSD was linked to a sister token, Luna, whose price was set by the market. Because 1 UST was defined as being equal to $1 worth of Luna, that meant that while the amount of Luna handed over in a swap for UST would vary, a holder of $1 in UST
elias 2 weeks ago
$LUNA and $UST both are on the Terra network.

Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned.

It works this way to help maintain the value of $UST which is 1 USD.

The main benefit for burning/producing Luna is to help maintain the stability of the network
jaseee 2 weeks ago
1)does know but may be they are playing with us.
2)Luna decrease due to some others small cryptocurrencies but later on it will stable again
RANDRIAMANANTENA 2 weeks ago
Car Luna et UST appartiennent à Terra et donc ils sont synchroniser
Orel16 2 weeks ago
Also known as "Elephants foot" or "Ponytail palm"
Irish 2 weeks ago
The terra protocol works as a distributed ledger that is maintained by validators on the network, that's just what I know, thank you for the BTC
Rayhbaum 2 weeks ago
$LUNA and $UST both belong to the Terra network. Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned. It works this way to help maintain the value of $UST which is 1 USD. The main benefit for burning/producing Luna is to help maintain the stability of the network.
dziunia171 2 weeks ago
$LUNA and $UST both belong to the Terra network. Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned. It works this way to help maintain the value of $UST which is 1 USD. The main benefit for burning/producing Luna is to help maintain the stability of the network.
Sarmad 2 weeks ago
Luna And UST Are Almost Dead Now And Falling Day By Day
Valid Mark 2 weeks ago
The relationship between UST and Luna was the primary source of value. DeFi products like Anchor were designed to drive demand for UST, and Luna was designed to absorb stablecoin price volatility. To that end, Luna was supposed to become more valuable as demand for UST increased.Earlier this month, the Terra (LUNC) blockchain effectively collapsed. The breakdown started when stablecoin TerraUSD (USTC) lost its peg to the U.S. dollar and the built-in arbitrage mechanism failed to resolve the problem. At that point, panicked investors started selling Luna and TerraUSD hand over fist.

However, Terraform Labs founder Do Kwon has a plan to revive the broken blockchain, and optimism surrounding that plan has both coins soaring today. As of 3:00 pm ET, Luna and UST were up 62% and 25%, respectively, in the last 24 hours.A crypto investor monitors price charts on a computer and a smartphone.
IMAGE SOURCE: GETTY IMAGES.

So what
Kwon discussed his revival plan for Terra in a recent blog post. Specifically, the blockchain will be forked to create a new chain, but the new chain will not include the UST stablecoin. Kwon's plan also outlines the creation of 1 billion new Luna coins, which will be distributed among developers alongside pre- and post-crash holders of Luna and UST.

The voting period is still open, but the proposal has already surpassed the threshold for adoption, and the fork is set to take place on May 27. At that time, the old chain and cryptocurrency will be known as Terra Classic and Luna Classic, while the new chain and cryptocurrency will be known as Terra and Luna. Of course, Kwon's proposal does not guarantee that investors will recoup all crash-related losses. The market will have to decide what the new Luna coin is worth.Terra was once a thriving ecosystem of decentralized finance (DeFi) services. Anchor (ANC) was the crown jewel, a lending protocol that paid 20% interest on UST deposits. But the platform included a number of other noteworthy applications. The Mirror protocol allowed investors to trade synthetic assets, and the Chai payments app had over 2 million users in South Korea.
ikwuwunna 2 weeks ago
The reason for the creation of Luna is to create a stablecoin like TerraUSD value at a 1.1 ratio with UST tokens
Md Ariful Haque mahi 2 weeks ago
Luna's aim was to keep the peg in ust and give voting power in the governance of the Terra chain.
In the Terrastation wallet there is a swap function where you could always burn 1 ust (regardless of its dollar value) to create 1 dollar of Luna out of nothing, this made it so that when the ust peg went below the dollar the people bought and burned ust to make a profit and brought the peg back to $ 1. You could also do the reverse process, that is to burn 1 dollar of Luna to get 1 ust (regardless of its dollar value), this meant that when ust tended to be worth more than 1 dollar, people bought and burned Luna to make a profit. Since burning 1 dollar of Luna you got 1 ust which in that moment of positive depeg was worth more than 1 dollar.
Since in any case it was necessary to burn Luna to create ust, the value of Luna increased proportionally to the adoption of ust. The system collapsed because there was a capital flight that began with a coordinated attack by some billionaires and continued with the panic of the holders, the peg was not maintained due to a saturation limit of the seigniorage system (the procedure seen above) which had a limit per block in the code.
aliyi 2 weeks ago
question mark
Srinivasan V 1 week ago
First about cryptos , they are volatile
And there is UST it is decentralised stablecoin which aim to maintain value $1 and there is
Luna which is destined to absorb stablecoin price volatility.
Luna was supposed to become more valuable as demand for UST increases
vnr368 1 week ago
UST IS STABE USD ON LUNA PLATFORM
Che Fanuelle 1 week ago
$LUNA and UST both belong to the Terra network Everytime someone mint's $UST, a dollar equivalent amount of $LUNA is burned. It works this way to help maintain the value of $UST which is the USD. the main benefits of burning or producing LUNa is to help maintain the stability of network.
bitearner 1 week ago
Luna and ust are connected in the sense that a mint in Luna is equivalent to a burn in ust
mohamedmido 1 week ago
.................
M 1 week ago
because it
alex 1 week ago
1-Because in the field of digital currency such as Luna, one can be sure of the main goal, which is to get the price of this currency, by presenting the plans of the relevant company.
2-Burning and reducing the number of this digital currency would make it more expensive, so it was useful in this case.
3-Luna is a newly formed currency and the connection? It is based on the ust makes a strong foundation for this digital currency, so the relationship between the two currencies is because of this issue.
fayez 1 week ago
Non-binding direct link
yuvi 4 days ago
$LUNA and $UST both belong to the Terra network. Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned. It works this way to help maintain the value of $UST which is 1 USD. The main benefit for burning/producing Luna is to help maintain the stability of the network.
high132ss 3 days ago
TerraUSD (UST) is a stablecoin hosted by the Terra network and created by South Korea's Terraform Labs. TerraUSD is one of a number of Terra stablecoins pegged to key currencies,and
LUNA is the native token of Terra, a blockchain developed by the Korean firm Terraform Labs. A total of $32m was raised to fund this development through the private sale of LUNA coins.
So the relationship between them is
UST relied on an algorithm and a sister cryptocurrency, Luna, to keep its price from fluctuating
Jared 17 hours ago
$LUNA and $UST both belong to the Terra network.

Everytime someone mints $UST, a dollar-equivalent amount of $LUNA is burned.

It works this way to help maintain the value of $UST which is 1 USD.

The main benefit for burning/producing Luna is to help maintain the stability of the network.