Terra (LUNA) is the native cryptocurrency of the Terra blockchain, a network originally created by Terraform Labs and co-founder Do Kwon to power a system of decentralized algorithmic stablecoins. Its primary function was to maintain the $1 peg of its sister token, TerraUSD (UST), through a unique mint-and-burn arbitrage mechanism; users could always swap $1 worth of LUNA for 1 UST, and vice versa. However, the project is most infamous for its catastrophic collapse in May 2022, where the peg failed and triggered a "death spiral" that hyperinflated the LUNA supply and wiped out approximately $40 billion in investor value within days. Following the crash, the blockchain split into two: the original chain was rebranded as Terra Classic (LUNC), while a new chain was launched retaining the name Terra (LUNA), this time without the algorithmic stablecoin component.
