Shortly after 12 p.m. EDT, Terraform Labs announced on Twitter that the blockchain’s miners had decided to halt the Terra blockchain in order to “prevent governance attacks” following “severe [luna] inflation.”
In a separate tweet minutes later, Terra said validators are working to restart the network “in a few minutes.”
The move comes after Terra’s luna token collapsed in value, falling to less than a penny on Thursday afternoon despite trading at about $80 one week ago.
Fueling the recent weakness, sister asset TerraUSD, a so-called stablecoin meant to trade at about $1, broke its peg last weekend, falling to 36 cents and trading at less than 32 cents on Thursday; algorithms are meant to help keep TerraUSD at $1, but the token uses luna as a stabilizing mechanism when the price deviates.
Terraform did not immediately respond to Forbes' request for comment.
On Saturday, TerraUSD fell below $1 as concerns over the Federal Reserve looming interest-rate hikes and removal of pandemic-era stimulus pummeled the broader crypto market and pushed luna down about 10%.
Despite vast attempts to reestablish the peg, TerraUSD has only collapsed further this week, feeding bearish sentiment. Bitcoin has tumbled nearly 19% over the past five days, while the broader cryptocurrency market has slipped below $1.3 trillion—down from a high above $3 trillion in November, according to CoinGecko.