Crypto's Had a Bad Week

The blockchain behind TerraUSD, the world’s third-largest stablecoin, was halted for almost two hours yesterday “to prevent governance attacks” amid widespread turmoil in the overall crypto market.

🪙 A deeper dive... As we've previously covered, a stablecoin is a type of crypto that’s meant to keep its value stable at $1 in order to facilitate transactions between other forms of crypto.

• The TerraUSD token, which first dipped below $1 on Sunday, fell below 28 cents yesterday before partially recovering to hover between 40 and 50 cents.
• TerraUSD’s sister coin, Luna – which is supposed to act as a financial counterweight anchoring the stablecoin to the dollar – dropped from $83 one week ago to just over 1 cent yesterday afternoon, erasing $28+ billion in market cap.

📉 Zoom out: The price of bitcoin dropped below $26,000 yesterday to hit its lowest level in 16 months, as the overall crypto market lost ~$200 billion over a 24-hour period.

• Tether, the world’s largest stablecoin, fell below $1 for nearly 12 hours during intraday trading yesterday, according to data from Google. Some hedge funds have reportedly intensified bets that Tether could break from its $1 level, per the WSJ.
• The stock price of Coinbase, the largest US crypto exchange, has fallen more than 75% on the year.