Understanding the Demise of UST and What Makes a Stablecoin Stable

Stablecoins are digital tokens backed by stable assets such as the US dollar, and were originally created for crypto investors to have an easy on- and off- ramp between fiat currencies and crypto. As stablecoin usage and market cap have increased, so has regulatory scrutiny. In particular, the reserve practices (or lack thereof) of various stablecoins have increasingly been in the spotlight - which brings us to the algorithmic stablecoin at the heart of the Terra ecosystem, UST.

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