GAM Holdings emerged as the first world giant to offer assistance to Terra and its deteriorating ecosystem. After the recent fiasco where Terra and two local cryptocurrencies fell in value, the organizations behind the project said they would seek outside help. One of the first former financial companies to step in to offer assistance was Swiss asset manager GAM Holding AG.
Will GAM Holding be Terra’s lifeline?
The 40-year-old company has started negotiations with Terraform Labs to “help support its Luna stablecoin (UST),” according to the official press release. GAM said it is “expected” to invest between $2 billion and $3 billion to “swallow the excess supply of UST during the current sale.” This is also expected to boost the UST stablecoin against the US dollar. GAM CEO Peter Sanderson uses the following phrases:
When black swan events affect markets, opportunities bloom. We see opportunity in UST’s recent activities and continue to see hope in Terra’s broader strategy.
Headquartered in Zurich, GAM has over $95 billion in assets under management. It is also publicly listed on the SIX Swiss Exchange. The move came amid reports that Terra had sought private equity assistance to support the UST fix. Blockchain has reportedly asked for over $1.5 billion.
Transactions stopped on the Terra network
As we have reported as Kriptokoin.com, due to the algorithmic nature of UST and its relationship with LUNA, when the stablecoin started to lose its value against the dollar, investors started to take advantage of the system by making arbitrage with LUNA. . This led to tremendous selling pressure, which resulted in a mind-blowing price drop. LUNA was trading above $80 a week ago, but as I write these lines, it is changing hands at $0.000055. Many exchanges have stopped trading, and Terra announced hours ago that it has stopped trading on its blockchain.
Prior to the announcement, Terra had paused its blockchain to cover the loss in its main tokens. The network has been halted for the second time in the last day and is not yet resumed trading on the chain. Still, its measures are considered ineffective so far.
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