Anchor Protocol, Terra’s largest DeFi platform, recommended blocking Anchor Earn and borrowing services to protect it from attackers. His community finally voted to determine his fate.
Since 70% of the stablecoin supply was locked to the platform, Anchor was pretty much ground zero for the UST collapse. As the stablecoin pulled back, it experienced one of the biggest drops in value history.
Users have chosen to limit how Anchor Protocol works, according to the company. Apart from withdrawing funds and depositing USTC to purchase a UST, all activities on the platform will now be halted. Interest-free deposits, on the other hand, will remain available indefinitely.
This will allow mirror protocols, or borrowers, to use aUST as collateral to obtain tokens when a margin call is required. A total of 23.11% of users voted “Yes” in favor of the suggestions.
TerraClassicUSD is currently trading at an average price of $0.0120 at press time. DO Kwon sent an airdrop in an attempt to resurrect the Terra Chain, which had collapsed.
This move, however, was also designed to help holders of old chain tokens. Meanwhile, the price of the newly produced LUNA coin has dropped 80% since its introduction. It is currently trading at $3.60 on average.
The Anchor Protocol has stated that it has been an integral part of Terra since its inception. The majority of the inhabitants want it to continue to exist. The community takes the decision seriously for its future.
Do Kwon hikes interest rates
According to a source, the inventors of Anchor revealed that the initial interest rate of the protocol was set at 3.6%. Terra’s leader, Do Kwon, however, did not accept the proposal. Just a week before launch, Anchor’s interest rate was raised to 20%.
According to the report, they set Terra’s interest a little higher than the bank rate to keep it constant. It was pointed out that the company did not have enough money to pay the interest. Terraform Labs’ internal design document, on the other hand, revealed that this was done to attract more investors.