Maker’s governance token MKR spiked more than 30% overnight, and its stablecoin DAI also benefited from the continued meltdown of Terra’s UST stablecoin, which slipped as low as $0.30 in the early hours of Wednesday morning.
MKR currently trades for $1,664 dollars a token, a price increase of a little over 35% in the last 24 hours, according to CoinMarketCap.
Maker’s token is used to govern MakerDAO, a decentralized autonomous organization, and Maker Protocol, a software platform; both allow for the creation and management of Maker’s algorithmically dollar-pegged DAI stablecoin, which has now leapfrogged UST as the fourth-largest stablecoin by market cap.
Terra’s algorithmic stablecoin TerraUSD (UST) is in the throes of a dramatic price crash. On Monday, the price fell from its dollar peg and continued its precipitous collapse on Tuesday.
On Tuesday, the Luna Foundation Guard (LFG), a non-profit supporting all things Terra (LUNA), voted to lend $1.5 billion in crypto to protect its native UST’s peg. The effort failed to stem the tide, with UST crashing even harder overnight; at 8:45 AM UTC today it bottomed out at $0.2998.
The price of LUNA, the currency which Terra burns a dollar’s worth for every new UST minted, is also crashing hard. At its current price of $2.20, LUNA has lost over 90% of its value overnight.
It currently remains uncertain what measures will be taken to re-peg UST, but Terra CEO Do Kwon addressed a nine-tweet thread for concerned Terra supporters. He wrote: “the only path forward will be to absorb the stablecoin supply that wants to exit before $UST can start to repeg. There is no way around it.”
7/ First, we endorse the community proposal 1164 to Increase basepool from 50M to 100M SDR *) Decrease PoolRecoveryBlock from 36 to 18 This will increase minting capacity from $293M to ~$1200M. https://t.co/aqNKzYK2xC
This should allow the system to absorb the UST more quickly.
There’s a wry humor in the fact that Bitcoin has at times been very closely correlated with traditional markets.
Bitcoiners generally prefer that BTC not have a high correlation with traditional assets, like stocks and bonds. After all, one of the core tenets of the world’s largest cryptocurrency by market capitalization—$379 billion as of this writing, according to CoinGecko—is that it bypasses traditional finance.
That’s why self-avowed Bitcoin fans, like Gemini co-founder Cameron Winklevoss,...
People moving on from the “speculative bubble” that is crypto, NFTs, and meme stocks is a positive sign for the U.S. economy, according to Wall Street heavyweight Ken Griffin.
Miami-based trading firm Citadel Securities’ founder said in a Wednesday interview with CNBC that government handouts in 2020, in response to the COVID-19 lockdowns, led to investors pumping their cash into “speculative assets” like NFTs, crypto, and meme stocks.
So-called meme stocks, shares of companies that gain a fol...
Institutional investor Bitcoin sentiment turned pessimistic on Friday as short Bitcoin inflows hit an all-time high, according to a new report from CoinShares.
Short Bitcoin funds give investors exposure to derivatives, like futures and options, that bet against the price of Bitcoin. While investors can enter into those contracts directly, the CoinShares report tracks the flow of funds for exchange-traded products.
By the end of last week, short Bitcoin investment products hit an all-time high...
