Following the Recent LUNA Plunge
Cryptocurrencies LUNA and UST have been delisted by multiple South Korean cryptocurrency exchanges.
After the recent LUNA plunge, UPbit announced on May 13 that trading would become unavailable at 12:00, May 20 and withdrawal would become unavailable on June 20. Gopax also announced that LUNA trading would be blocked at 15:00, May 16 and withdrawal would be possible until June 16.
Foreign cryptocurrency exchanges are moving in the same direction. OKX delisted UST and related derivatives on May 13. FTX delisted derivative LUNAPERP, Crypto.com blocked LUNA, ANC and MIR trading, and Coinbase said that trading would be blocked on May 27.
LUNA and UST are paired stablecoins. The latter is designed to follow the price of the former and regulate the demand and supply of the former to be exchangeable at a value of US$1. In other words, an increase in UST volatility leads to an increase in LUNA volatility in this algorithm.
Terraform Labs increased LUNA issuance as depegging continued, that is, the value of UST remained far below US$1. It tried to recover the price of UST by buying UST with LUNA and reducing the distribution, but the attempt failed, the value of LUNA plummeted due to a surge in currency volume, and investors panic-sold both UST and LUNA. According to insiders, the depegging was caused by a large scale of ANC withdrawal.