Terra, the blockchain behind the Luna crypto, announced today that it would be temporarily halting operations as the particular crypto practically went to zero following the loss of its US dollar peg earlier this week, shedding nearly 100% of its market value in the past seven days.
According to Terra’s Twitter announcement, its validators have decided to stop the Terra chain briefly to prevent further governance attacks amid the severe inflation of the $Luna and mitigate more losses. It is worth noting that the price plummeting of the Luna governance token has also made the blockchain network more susceptible to attackers, thus, the decision to halt operations – albeit only for a while.
An hour and a half later, a particular block explorer confirmed that Terra blockchain had restarted block production, with staking still unavailable. As per Terra’s official announcement of the block production restart, delegations are now disabled as the chain is live again with a new code merge.
On top of the brief operation halting, Terraform Labs, the creators of UST and LUNA, revealed several steps to which it would be undertaking to salvage the Terra ecosystem itself following the collapse of the two coins.
While Terra’s announcement was meant to reassure its supporters and users that it would recover shortly, crypto industry insiders and observers remain skeptical, arguing that Terra is going on a wrong path of recovery based on its announcements.