## The Terra UST is in ICU long live the stable coin

![image.png](https://cdn.steemitimages.com/DQmPeNpqAVuoDLfBwTQWvniKqgfqrpekqjx1K5NVLP32vbV/image.png)
[source](https://pixabay.com/illustrations/space-volcano-star-trek-spock-5058703/)

## The Drama in the fast lane of crypto
If you are in the crypto space your life is never short of any drama and exposure to volatility.
As the jury is out about what actually happened and the chronology of events leading to the collapse of the Terra UST peg and what is being done to mitigate the damage.

The current update from the Terra UST twitter account is that the Terra blockchain has been halted and there are planning to reconstitute it.
This is what the tweet reads

"The Terra blockchain has officially halted at block 7607789.

Terra Validators have halted the network to come up with a plan to reconstitute it. 

More updates to come."

The official tweet can be accessed here
https://twitter.com/terra_money/status/1524935730308456448

Having said that I see it as no surprise as how quickly crypto fortunes change.

Till just a few days back Both Terra Luna and the Terra UST the terra backed stable coin was the darling of the investors and projects alike.
This was for good reason the terra UST was at the forefront of the stable coin crypto space.

Though it has seen deviations from its stable peg in the past as can be seen from its all time charts.


![image.png](https://cdn.steemitimages.com/DQmZ6miD7uBwkpaPUXuNbkC9VbThz81wfZ2A1vFdQkqehqH/image.png)

source:coinmarketcap.com

However this time round the deviation has been fatal. Some may say it is an algo experiment that has failed.
However for those who have lost their hard earned money this is surly a very cruel joke that is certainly not funny.

## Why stable coin market is important ?
For anyone dealing in the crypto space one needs to trade the volatile crypto against a stable or fixed asset.
This helps us trade the volatility and use it to our benefit by trading it against a stable coin.
For example if BTC is about to correct one can sell it against a stable coin and then wait for the correction to get over.
Once done one can use the stable coins to buy back the BTC

Let us understand this with the help of BTC chart.


![image.png](https://cdn.steemitimages.com/DQmWtiFrhAYMng5BLiuUL6ZaQiEG5DGM3hokQ9KTLiDyhME/image.png)
source: coinmarketcap.com

One strategy : On hindsight could have been you sell BTC at the top for BUSD or some other stable coin and when the price is low and the charts suggest a buy opportunity you buy BTC again.

This way would end up increasing your stash of BTC

## Is all lost for the stable coins?
The value and importance and significance of the stable coins cannot be denied.
The current TerraUST debacle episode has indeed raised some serious issues about the algo stable crypto coins in general.

However there is a lot more to the crypto stable coin space than the Terra UST.

## Having a birds eye view of the stable coin space
As the name suggests a stable coin is backed by another asset in order to maintain its value.
The backing by another asset helps to maintain its value.

With this idea clear one can take respite that there are more than one kinds of stable coins.
The Terra UST crash has introduced us to the ugly side of the algo stable coins.
Apart from this there are the following types of stable coins based on the type of backing
Fiat backed : Crypto is backed by real world fiat
Crypto backed and 
Commodity backed 
  
 ## The silver lining to the current situations
There are many options while choosing a stable coin so do your research and choose a stable coin wisely.