A week of terra: behind the collapse of a $26b stablecoin

The collapse of Terra coin has sent shockwaves through the market. This is how it happened.

Jessica Sier and Jonathan Shapiro

May 13, 2022 – 5.31pm

Email LinkedIn Twitter Facebook

Subscribe to gift this article

Gift 5 articles to anyone you choose each month when you subscribe.

Subscribe now

Already a subscriber?

It all started last Sunday. A mysterious entity dumped $US350 million ($508 million) of a popular cyptocurrency called Terra, with that one trade overwhelming the market and sucking out liquidity.

The shock was so abrupt and traders so blindsided that Terra “broke the buck” and began falling. The coin was designed to track movement in the US dollar and provide safety in the volatile crypto world, but the selling broke the peg and panic ensued.

Email LinkedIn Twitter Facebook

Subscribe to gift this article

Gift 5 articles to anyone you choose each month when you subscribe.

Subscribe now

Already a subscriber?

License article

Introducing your Newsfeed

Follow the topics, people and companies that matter to you.

Find out more

Jessica SierNorth Asia correspondentJessica Sier is the North Asia Correspondent for The Australian Financial Review. She is based in Tokyo, Japan. Jessica has previously written on technology, global capital markets and economics.

Jonathan ShapiroSenior reporterJonathan Shapiro writes about banking and finance, specialising in hedge funds, corporate debt, private equity and investment banking. He is based in Sydney.