Terra’s astronomic crash has largely dented market sentiment this week, and likely fed broader crypto weakness.
But the project’s status as a Layer-1 blockchain meant that several tokens, apart from LUNA and UST were caught in the crossfire. The network was suspended twice this week, which added to the disruption.
The UST crash appears to have undermined broader investor confidence in the Terra ecosystem. Several DeFi protocols, despite acting independently from Terraform Labs, have seen their values crash to near zero this week.
Underpinning these losses was also one of the worst crypto market crashes in recent history, which saw as much as $900 billion in market capital erased.
Terra’s fall takes Anchor, Mars in tow
Anchor Protocol (ANC)- Terra’s largest DeFi platform, was a major casualty of the crash. Given that nearly 70% of UST supply was staked on the platform, it saw its value diminish rapidly within hours.
