Binance Suspends LUNA and UST Withdrawals Due to Market Volatility

　　Cryptocurrency exchange Binance has stopped LUNA and UST token withdrawals as the Terra-based stablecoin tries to regain its peg to the US dollar.

　　Binance announced the temporary restrictions in a blog post earlier this morning, blaming network congestion for “a huge volume of outstanding withdrawal transactions.”

　　“Binance will reopen withdrawals for these tokens once the network is deemed reliable and the volume of pending withdrawals has decreased.” In a subsequent notification, we will not alert users, the company added.

　　The announcement comes at a time when Terra's algorithmic stablecoin UST — the third largest stablecoin by total issuance behind USDT and USDC — has plummeted dramatically against the dollar.

　　Efforts have been undertaken to strengthen UST. Luna Foundation Guard (LFG), a Singapore-based organization founded to assist both Terra-based stablecoins and the broader Terra ecosystem, announced a plan to lend $1.5 billion in bitcoin and UST to third-party trading firms in order to sustain UST's peg on May 9.

　　Nonetheless, the price of UST has continued to plummet in comparison to USDT, the largest dollar-pegged stablecoin. According to Binance data, it hit a low of $0.6065 on Monday. It has since recovered somewhat to roughly $0.85 at press time.

　　Meanwhile, the price of LUNA, the Terra blockchain's native asset that may be burned in exchange for UST in normal market conditions, has dropped from over $62.50 just 24 hours ago to around $28.50 at press time, according to CoinGecko data.

　　Terra and LFG must also fight with significant volatility in the broader crypto markets. Bitcoin briefly fell below $30,000 yesterday before rebounding to roughly $31,500 at press time.

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