Terra’s US dollar-pegged algorithmic cryptocurrency UST is moving up the ladder and now ranks third in terms of overall market capitalization.
Today, the fast-growing Terra USD (UST) stablecoin from the Terra ecosystem passed another pivotal point, reaching a market valuation of more than $17 billion.
As of Tuesday, UST had eclipsed the BSC-based stablecoin BUSD in market capitalization by more than $67 million.
To mint an equivalent amount of UST, a user must burn a reserve asset such as Terra (LUNA).
UST Making Headlines
This year, the Terra blockchain network has been the talk of the crypto world. Following its participation in the broader market downturn over the weekend, Terra’s native cryptocurrency LUNA has had the highest 24-hour bounce.
Terra (LUNA) is currently trading 15% higher at $90, with a market valuation of $32 billion. Terra has surpassed Cardano’s ADA to become the eighth-largest cryptocurrency by market cap as a result of this development.
As of this writing, the leading stablecoin is Tether (USDT), which has a market cap of $82 billion. USD Coin (USDC) is ranked second with a market cap of nearly $50 billion.
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LUNA total market cap at $31.10 billion on the daily chart | Source: TradingView.com
UST is formed by burning a single terra (LUNA), the Terra network’s original crypto currency.
Other sorts of decentralized stablecoin projects, such as Makerdao’s DAI, rely on an over-collateralization procedure to maintain the token’s peg to the dollar.
The value of Terra’s stablecoin UST has increased exponentially during the last 509 days, or 16 months.
Additionally, recent data indicates that UST has been on a stratospheric rise since mid-November, with the market cap jumping by 525 percent.
Lower Trade Volume
Despite outperforming BUSD in terms of market capitalization, UST trades at a far lower volume compared to its immediate competition, with Binance’s stablecoin witnessing $2.25 billion in trading volume over the last 24 hours compared to UST’s $431.78 million.
On the other hand, Terra has recently made headlines for its Bitcoin acquisition. The Luna Foundation Guard (LFG), its parent organization, has acquired approximately 30,000 BTC to act as a peg and reserve for its UST stablecoin.
But, it has a lot going on behind the scenes. LFG intends to acquire a total of 410 billion dollars’ worth of Bitcoin.
However, similar to the broader crypto market in recent months, bullish pronouncements are doing nothing to boost the price of LUNA.
The token’s price has fallen 12.5% in the last 30 days to $77.30, and it has also retreated 34.3 percent since reaching an all-time high of $119.18 on April 5.
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Featured image from Cryptonary, chart from TradingView.com