Binance suspends LUNA and UST trading amid price crash

Binance CEO ‘very disappointed with how the UST/LUNA incident was handled’

Hand holding mobile with Binance app running at smartphone screen with Binance logo in background                                 
Hand holding mobile with Binance app running at smartphone screen with Binance logo in background - Photo:Alamy
                                

Binance, the world’s largest cryptocurrency exchange by trading volume, has suspended Terra (LUNA) and TerraUSD (UST) spot trading after the stablecoin UST lost its peg to the US dollar.

The crypto exchange no longer allows LUNA/BUSD and UST/BUSD trading pairs. Binance USD is BUSD, which is a 1:1 USD-backed stablecoin issued by Binance.

UST is a stablecoin on the Terra blockchain, and its sister token LUNA, which was meant to help UST stay linked to the US dollar, has also fallen.

According to CoinMarketCap, UST has dropped by 67% to $0.17 and LUNA by 99% to $0.00003707.

Binance CEO ‘disdappointed’

Changpeng Zhao, CEO of Binance, tweeted saying he was “very disappointed with how the UST/LUNA incident was handled (or not handled) by the Terra team.”  

The Binance CEO said that the crypto exchange “always aims to be neutral” and tends to refrain from “commenting on other projects”. However, Zhao said, he was breaking this rule for the LUNA/UST collapse.

Binance did request that the Terra team implement certain changes to help the situation, but the crypto exchange did not receive any positive response “or much response at all” from Terra, Zhao said.   

Zhao finished his thread of tweets by saying: “We felt suspending trading is the best way to protect our users at this time. We will continue to monitor the situation closely 24/7.”

Second suspension for UST

The suspension is the second in three days for UST. On 10 May Binance “temporarily suspended” withdrawals for UST from 03:20 to 10.50 BST (UTC +1).

At the time Binance said this was due to due to a “high volume of pending withdrawal transactions”, which caused “network slowness and congestion”.

Before restarting withdrawals, Binance had said it would resume withdrawals for UST once it “deems the network to be stable and the volume of pending withdrawals has reduced.”

The crypto exchange in its announcement today (13 May) regarding LUNA and UST spot trading mirrored these words as it again said: “withdrawals for LUNA and UST will open when the network becomes stable.”

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