Terra blockchain's UST stablecoin fell below its $1 price peg. At the moment of writing, UST trades at around $0.92. On May 9, the stablecoins dropped as low as 68 cents according to data by CoinMarcetCap.
UST is an algorithmic stablecoin created by Terraform Labs in 2018. Terra uses complex codes and maintans the price peg with LUNA, the other native coin of the blockchain. Also, the project holds billions of dollars in Bitcoin in its reserve to use the coins in times of crisis to keep stable price.
The Terra team twitted that the coin is fighting back the material $UST peg deviation on third-party values. It also wrote that peg regaining takes time given the parameters, but the price bounces back.
Meanwhile, Luna Foundation Guard Council has voted to loan $750 million worth of Bitcoin to OTC trading firms to help to stabilize the price. Loan 750M UST to accumulate Bitcoin as market conditions normalize.
LUNA has faced volatility too. The coin trades at around $32, falling around 61% in the last 7 days.