Algorithmic stablecoin TeraUSD collapsed on Wednesday (11th) and encryption scarecurrencyMarket, but after 24 hours on Thursday (12th), the market conditions clearly calmed down.
Terra Blockchain developer TerraForm Labs has previously suspended operations of the Terra Blockchain and resumed it after the rapid collapse of TerraUSD and its linked Luna blockchain token. Tether, the most used stablecoin in the cryptocurrency market, has dominated trading after recovering from a mini-crash, calming traders’ panic.
According to data from Bloomberg, several major currencies in the decentralized finance sector are up 8% in New York on the 12th at 4:45 p.m., including Avalanche. The price of ApeCoin on the CoinMarketCap.com platform also increased by about 25%.
BitcoinIt recovered from the tragic drop on Wednesday to nearly $25,000, and once again rose 6% to nearly $30,000. Some altcoins are also rising. Bitcoin Cash’s biggest increase once reached 20%, but that has since converged.
In the crypto markets on Wednesday, the stablecoin TeraUSD, which is closely tied to the US Dollar, not only fell below par with the US Dollar, but at one point dropped to $0.23, causing a catastrophe. Bitcoin is down about 10% that day.
Matt Malee, chief market strategist at Miller Tabak + Co., said: “Once Tether stabilized, the selling pressure representing a market margin call subsided. Each time it was forced to sell, it It was over. People were still nervous, but the sell-off has slowed.InvestmentFew more days people will be worried, but supply and demand is back in balance. ,
Commenting on Wednesday’s volatile cryptocurrency markets, US Treasury Secretary Janet Yellen said that Terra’s collapse showed the dangers of stablecoins to the US dollar, but stressed that it does not pose a threat to financial stability.
Brian Nick, chief investment officer at Nuveen, said that not many people have a lot of cryptocurrencies, mainly due to the low economic importance of cryptocurrencies. He added: “When financial conditions start to tighten, who will be punished? The answer is any asset that is more valuable, has higher uncertainty, and has no source of revenue.” Cryptocurrencies are one of the representatives of such assets.
So, is the cryptocurrency now calm before the next storm? Michael Purves, CEO of Tollbacken Capital Advisors, predicted in the latest analysis report: “Bitcoin will go down, with the potential to reach $20,000 or $15,000.”
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