What is terrausd and how does it work in the world of cryptocurrencies?

3 answers

• Mar 19, 2022 · 3 years ago
  Terrausd is a stablecoin that operates on the Terra blockchain. It is designed to maintain a stable value by being pegged to the US dollar. This means that for every terrausd token in circulation, there is an equivalent amount of US dollars held in reserve. The stability of terrausd makes it an attractive option for traders and investors who want to avoid the volatility commonly associated with other cryptocurrencies. It can be used for various purposes such as payments, remittances, and as a store of value.
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• Mar 19, 2022 · 3 years ago
  Terrausd works by utilizing a decentralized system of smart contracts on the Terra blockchain. These smart contracts ensure that the supply of terrausd tokens is always backed by an equivalent amount of US dollars held in reserve. When someone wants to mint terrausd, they deposit US dollars into the reserve and receive an equivalent amount of terrausd tokens. Conversely, when someone wants to redeem their terrausd for US dollars, they can do so by burning the tokens, which will release the corresponding amount of US dollars from the reserve. This mechanism ensures the stability and trustworthiness of terrausd as a stablecoin.
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• Mar 19, 2022 · 3 years ago
  Terrausd, also known as UST, is a stablecoin issued by the Terra protocol. It is backed by a collateralized reserve of various assets, including fiat currencies and cryptocurrencies. The stability of terrausd is maintained through an algorithmic mechanism that adjusts the supply of UST based on market demand. This means that if the demand for UST increases, more tokens will be minted to meet the demand, and if the demand decreases, tokens will be burned to reduce the supply. The algorithmic nature of terrausd ensures that its value remains close to the US dollar, making it a reliable and widely accepted stablecoin in the world of cryptocurrencies.
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