Abstract
Terra Classic (LUNC) is a blockchain network launched in 2019 that uses a Proof-of-Stake (PoS) consensus algorithm to reach a consensus about the state of its distributed ledger. The network’s native digital currency is Luna Classic (LUNC), which is used to carry out governance and staking on the platform. Terra Classic’s blockchain architecture allows the creation of algorithmic stablecoins. TerraClassicUSD (USTC), TerraClassicKRW (KRTC), and other stablecoins on the platform have their price maintained through a process called arbitrage. This price maintenance mechanism came under fire in early May 2022, when the selling pressure caused USTC (named UST at the time) to lose its $1 peg, which led to the collapse of LUNC (named LUNA at the time). In the aftermath of the market collapse, a new Terra (LUNA) blockchain was launched, with no algorithmic stablecoin capabilities.