Breaking: Terra restarts blockchain while LUNA trades around $0

FXStreet Team FXStreet

In a recent tweet, Terra announced that its blockchain resumed block production. Still, validators decided to disable on-chain swaps and close IBC channels while enabling users to bridge off-chain assets, such as bETH, to their native chains.

Binance CEO Changpeng Zhao said to be "very disappointed" with how the Terra team handled the collapse of UST and LUNA. He mentioned having requested Terra to "restore the network, burn the extra minted LUNA, and recover the UST peg" but did not receive any positive answers. Based on this stance, Zhao decided to suspend trading for LUNA and UST to protect its customers.

While other cryptocurrency exchanges follow suit, some market participants remain hopeful that LUNA will bounce back. The only problem with this thesis is that the Terra team has increased the token's circulating supply from around 377 million LUNA to more than 170 billion LUNA in the past 24 hours.

Such an enormous amount of tokens put into circulation would make it nearly impossible for LUNA to recover some of the market value it lost after the death spiral.