The exchange announced that it had canceled all pending orders, ceased trading, closed user positions, and conducted an automatic settlement of all LUNA trading pairs.
In accordance with our policy to protect our users during excessive volatility, Binance shall adjust the tick size (i.e., the minimum change in the unit price) of certain spot trading pairs.
CZ explains Binance’s position
Changpeng Zhao, the CEO of the crypto firm, in a series of tweets, revealed why the exchange was “suspending LUNA and UST trading.”
1. At #Binance we prioritize user protection. We made the decision to suspend LUNA and UST trading. Here's why.
— CZ Binance (@cz_binance) May 13, 2022
Per his statement, some users might be unaware that Terra’s developers were still minting new units of LUNA outside the exchange. CZ said the minting would lead to a further crash of the asset’s price immediately if deposits were allowed.
Very disappointed with how this UST/LUNA incident was handled (or not handled) by the Terra team. We requested their team to restore the network, burn the extra minted LUNA, and recover the UST peg. So far, we have not gotten any positive response, or much response at all.
Other exchanges warn against trading Terra
South Korean crypto exchange Korbit told investors to watch their investments in LUNA closely. Another major exchange, Coinone, also temporarily suspended trading the token.
Bithumb designated an investment warning item to warn investors who might want to get involved.
“Given the continued risks of the LUNA market and in order to eliminate the possibility of further shortfall, the community has asked to suspend the LUNA market effective immediately,” the statement reads.
Terra developers working on stemming LUNA bleed
The official account of Terra has announced proposals to correct the state of things by burning UST, but that may not be enough to remedy the network.
The Terra blockchain was officially halted at a block height of 7603700.https://t.co/squ5MZ5VDK
Terra validators have decided to halt the Terra chain to prevent governance attacks following severe $LUNA inflation and a significantly reduced cost of attack.
— Terra (UST) Powered by LUNA (@terra_money) May 12, 2022
Terra announced it was halting the network “to prevent governance attacks following severe $LUNA inflation.” However, after releasing a patch, the network has resumed its block production.
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