- The industry is not mature for algorithmic stablecoin following the UST collapse.
- Ava Labs President John Wu said that Tether needs to work on USDT transparency.
- The US Congress suggested that stablecoins need new regulations.
John Wu, the president of Ava Labs, said while fielding questions from Bloomberg journalists that the cryptocurrency industry is fine right now without algorithmic stablecoins.
His comment came in last Monday after last week’s implosion of the TerraUSD, where their algorithmic stablecoin, UST, lost its stability, plunging to $0.2 from the $1 peg.
Algorithmic stablecoins, like UST, magic internet money (MIM), FRAX, and Neutrino USD (USDN), are undercollateralized tokens or assets without independent reserves to back their value. They rely on an on-chain algorithm to facilitate any change in supply and demand between them and the cryptocurrency that maintains them.
Wu said UST was a case of a failed inn …