TerraUSD is a decentralized stablecoin
While it's not easy to determine which stablecoin is right for you, there are several factors that you should consider before you buy TerraUSD. First, you should know that the bulk of PoS networks have stable block rewards. You can expect a slight daily fluctuation in the value of the stablecoin. Value moves of more than 1-2 percent are considered a break from the peg. Besides that, you should also know that you can swap TerraUSD for the stablecoin TerraKRW on the chain with negligible fx fees. The next step is to learn about the TerraUSD mining rewards.
The first TerraUSD token was released on Bittrex Global on September 12, 2020. Since then, the coin has become immensely popular. It's value has been beating other stablecoins such as Gemini's GUSD and Paxos' PAX. The primary difference between these two coins is the issuer's control of the token. TerraUSD is backed by fiat money in banks.
It is pegged to the value of the U.S. dollar
A stablecoin is a cryptocurrency that is pegged to a fiat currency such as the U.S. dollar. All stablecoins experience daily value fluctuations. Any value change of more than two percent is considered a peg break. This is an issue in the TerraUSD ecosystem, where a stablecoin peg can be a limiting factor to the potential value of a cryptocurrency.
While many stablecoins use a mechanism called LUNA to stabilize the value of their currency, UST is algorithmically held and is not backed by real dollar reserves. This makes it an ideal medium of exchange for DeFi and TraFi, where the price of one currency is tied to the value of another. Additionally, LUNA, a staking token in Terra, is burned to mint a single UST.
It has low transaction fees
TerraUSD is one of the most stable digital assets on the market today. It is pegged to the United States dollar, and mints new by burning LUNA coins. Terra is much faster than Tether, with transactions verified within seconds. Transaction fees are much lower than those of USDT. Terra is compatible with other blockchain applications, and it is fungible, with the same value as other UST. It can be purchased through various cryptocurrency platforms.
To purchase Terra Luna cryptocurrency, you can use a crypto wallet. Crypto wallets are centralized hubs for storing and sending cryptocurrencies. Many of them support decentralized financial applications. However, you should avoid using hot storage wallets unless you are familiar with the nuances of crypto currency exchange. For example, Coinbase has a wallet for Luna. Luna can be staked on the Terra blockchain. While this wallet can be very convenient, it is not ideal for trading in volatile cryptoassets.
It is censorship-resistant
The goal of TerraUSD is to create the first censorship-resistant currency, with a savings experience similar to a traditional savings account. Stablecoins are a useful user onramp to decentralized applications, but they are only available on Ethereum and a few other chains. This limit restricts their adoption by developers and application creators. Besides, there is an increased risk of censorship if your coins are not backed by any assets.
Miners play a significant role in maintaining the stability of the Terra network, and proof-of-stake consensus helps maintain this stability. However, the most important need for security is constant mining demand. Because of this, TerraUSD's protocol aims to ensure constant payouts, regardless of economic conditions. The currency is designed to reward individuals who protect and grow the Terra network. If the system can achieve its goal of becoming a truly censorship-resistant currency, it will be a success.
