Terraform Labs, the business that manages the Terra system, momentarily paused the Terra blockchain on Thursday for 2 hours after a sharp drop in LUNA and UST, before resuming operations approximately at 1:45 p.m. local time.
The firm was halted to apply a patch that would prohibit users from staking on its network, according to the firm.
Terraform described that the halt of blockchain processes was needed to “avoid governance attacks” because the rate of LUNA had fallen too low.
“Terra validators have decided to halt the Terra chain to prevent governance attacks following severe $LUNA inflation and a significantly reduced cost of attack.”
The Terra blockchain network quit producing new squares after its square level was 7603700, meaning holders couldn’t move their Terra resources until the blockchain process was halted.
At the time of composing, the Terra stablecoin TerraUSD (UST) was trading at $0.1288, having lost its peg to the United States dollar.
The founder behind it, Do Kwon, noted in a series of tweets:
“Before anything else, the only way forward is to absorb the stablecoin supply that wishes to exit before $UST begins to re-peg. There is no getting around that.”
LUNA had dropped to less than $0.50 by late Thursday, down from about $120 in early April. LUNA reversed all of its gains during the previous 12 months.
