Posted On May 24, 2022 Consumer Privacy & Data Breaches
May 24, 2022 -In recent cryptocurrency news, the Terra stablecoin lost its peg to the U.S. dollar, causing the value of the coin to plummet from a high of $119 to almost zero. If you were a TerraUSD investor who woke up to a portfolio that was worth only a small fraction of what it was weeks ago, you probably have questions about what happened. You may also be wondering if there is anything you can do to recover some or all of your losses.
The cryptocurrency lawyers at Console & Associates, P.C. are investigating the TerraUSD collapse on behalf of investors who were affected by the stablecoin’s devaluation. We are currently looking into whether aggrieved investors can bring claims against any and all involved parties including individuals, companies, platforms and exchanges that promoted the Terra coin as stable. As a part of this investigation, we are setting up free consultations with aggrieved investors to help them determine if they have a claim against any of these parties.
Terra stablecoin was first created in 2018 by Terraform Labs, a company founded by Do Kwon and Daniel Shin. The idea behind TerraUSD, or any other stablecoin, is that it is a safe investment because it is pegged to a stable currency. In the case of TerraUSD, the coin is pegged to the U.S. dollar. Thus, the goal is for the stablecoin to maintain its peg to the dollar, and investors make money by the interest that is paid based on each coin held.
However, the value of a stablecoin is inherently tied to its ability to maintain its peg to the underlying asset.
TerraUSD collapsed when it lost its peg to the U.S. dollar. Essentially, the stablecoin’s internal rules changed, and the interest rate went from approximately 20% to a variable rate. This caused many TerraUSD holders to move their money elsewhere, which resulted in TerraUSD becoming almost worthless overnight.
Cryptocurrency is often thought of as an entirely unregulated asset. However, in reality, there is some level of regulation in the industry. While the specifics of cryptocurrency regulation are not as developed as with other investable assets, the individuals who create the coin and the platforms and exchanges that promoted them are bound by laws prohibiting they make fraudulent and misleading statements. Thus, depending on the outcome of the investigation, aggrieved investors may have a claim against one or more parties following the Terra stablecoin collapse.
Were you a TerraUSD investor who lost thousands when the stablecoin collapsed? Are you looking for ways to recover your losses? Do you feel duped by what you were told about the stablecoin? If so, reach out to the law firm of Console & Associates, P.C. At Console & Associates, P.C, our cryptocurrency lawyers are here to help aggrieved investors learn about their rights. We can help you determine if you have a case against the creators of the currency or any of the platforms or exchanges that marketed TerraUSD as stable. We offer free consultations to all prospective clients, so there is no risk in calling. To learn more, and to schedule a free consultation today, call 866-778-5500 or through our online contact form.
