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According to the bank’s analysts, the project team was focused on implementing the UST stablecoin, rather than maintaining its course.
What happened? Bank of America (BofA) named a possible cause of the collapse of the Terra ecosystem. According to the bank’s analysts, the project team was focused on the implementation of the TerraUSD (UST) stablecoin, rather than maintaining its course. Experts added that the UST was not backed by traditional assets, CoinDesk reports, citing a note from the bank.
Information on the CoinDesk website
What else did the bank say? In BofA, the stablecoin market is considered stable, since the loss of the UST peg to the US dollar did not affect the state of other similar coins. The ban on algorithmic stablecoins in general, representatives of the bank consider premature, experts still see the potential in this type of asset.
What events have happened before? Analysts at investment bank Goldman Sachs explained that for the viability and long-term operation of algorithmic stablecoins, they need to find a wider application for payments in the real economy. The bank also noted that the recent collapse in the cryptocurrency market in the long term will not have a significant impact on the US economy. U.S. Treasury Secretary Janet Yellen believes that the cryptocurrency market has not yet grown to such a scale as to pose a “systemic risk.”
After the collapse of Terra, south Korea’s tax service accused the head of Terraform Labs, Do Kwon, of tax evasion in the amount of $ 78.4 million. And on May 20, it became known that Kwon liquidated the legal entity Terraform Labs on April 30, a few days before the collapse of the UST course. A detailed chronology of events can be found at the link in the Article GetBlock Magazine.
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