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Usha Yadav
May 20, 2022
by Usha Yadav

Avalanche Founder Says Terra Is as Bad as Mt. Gox

Avalanche
Avalanche founder Emin Gün Sirer compared the seriousness of the Terra crash to the Mt. Gox breach in a recent interview with Forbes. He is concerned that this incident may lead to increased regulatory scrutiny. The Terra ecosystem collapsed earlier this month, with the LUNA token plunging to zero after the UST stablecoin was de-pegged. Mt. Gox, the biggest crypto exchange in its prime, went bankrupt in February 2014 after a massive hack, causing an enormous Bitcoin price drop.

He admits that Avalanche was getting choked by LUNA's fast growth at one point because it was attracting plenty of money. The rise of LUNA also led to the creation of copycats that wanted to replicate its success. Avalanche then decided to form a partnership with Terra that was "obviously problematic." As a result, he concedes that the Avalanche Foundation has lost "some money." He stressed that it was not a problem for the foundation in the broad scheme of things.

The LFG currently has around $60 million in its account. Even if it sold all of these coins at once, the sale would have little impact on the token's price because its trading volume is substantially larger. Terra has certified that its AVAX coins have not been sold. The Avalanche Foundation was well aware of the dangers of algorithmic stablecoins, but it opted to pursue the cooperation regardless because it could generate significant results.

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Avalanche Terra
Avalanche Founder Says Terra Is as Bad as Mt. Gox
Usha Yadav
Usha is a diehard crypto enthusiast and has been actively writing on different facets of the blockchain and crypto world. She has authored many research articles on cryptocurrency and aims to provide informational and quality content to readers. She firmly believes that crypto has a great potential to redefine the world of finance and blockchain.

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