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Not Just UST; Terra Crash Hits These Cryptos Hard

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Terra’s astronomic crash has largely dented market sentiment this week, and likely fed broader crypto weakness.

But the project’s status as a Layer-1 blockchain meant that several tokens, apart from LUNA and UST were caught in the crossfire. The network was suspended twice this week, which added to the disruption.

The UST crash appears to have undermined broader investor confidence in the Terra ecosystem. Several DeFi protocols, despite acting independently from Terraform Labs, have seen their values crash to near zero this week.

Underpinning these losses was also one of the worst crypto market crashes in recent history, which saw as much as $900 billion in market capital erased.

Terra’s fall takes Anchor, Mars in tow

Anchor Protocol (ANC)- Terra’s largest DeFi platform, was a major casualty of the crash. Given that nearly 70% of UST supply was staked on the platform, it saw its value diminish rapidly within hours.

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The platform, as of last week, was the third-largest DeFi platform, at a total value locked (TVL) of over $16 billion. Today, its value is about $300 million. Anchor’s governance token, ANC, is trading slightly above record lows at $0.2.

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Mars Protocol, another DeFi platform on Terra, saw its TVL plummet 96% in the past week. The platform’s governance token, MARS, is also near record lows, at $0.1.

Other protocols, including Mirror, Prism, and Nexus, are all trading at a fraction of their previous value, around record lows.

Crypto lender Nexo also appeared to have taken a major hit from the Terra crash. Its token, NEXO, slumped about 45% this week. The platform was exposed the the crash, through a 2019 partnership that allowed users to deposit on the platform in UST.

Venture capitalists also not spared

Venture capitalists who had invested heavily in Terra are also facing growing ire from LUNA and UST holders. Zhu Su, CEO of Three Arrows Capital- a major Terra backer- took to Twitter on Friday, expressing remorse and sympathy over the debacle.

Su was a vocal proponent of Terra, known for sometimes making contentious remarks over other projects. Still, he said he would still back the blockchain.

Other venture capitalists may not be so forgiving. Terra has so far found no takers in its solicitations for the $1 billion needed to rescue the project.

With more than five years of experience covering global financial markets, Ambar intends to leverage this knowledge towards the rapidly expanding world of crypto and DeFi. His interest lies chiefly in finding how geopolitical developments can impact crypto markets, and what that could mean for your bitcoin holdings. When he isn’t trawling through the web for the latest breaking news, you can find him playing videogames or watching Seinfeld reruns.
You can reach him at [email protected]
Not Just UST; Terra Crash Hits These Cryptos Hard Blockchain CoinGenius Hosts Virtual Crypto Event The Road To Mass Adoption
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

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  • Source: https://coingape.com/not-just-ust-terra-crash-hits-these-cryptos-hard/

This Post was originally published on Coingape

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