Nox Bitcoin To Refund UST At $1 To Their Customers
May 22 2022 - 12:00PM
NEWSBTC
Nox Bitcoin, a cryptocurrency exchange in Brazil, has taken the
unprecedented step of using its own funds to refund customers for
their TerraUSD coins at the full rate. Following local media’s
report on May 20, the Nox Bitcoin exchange has refunded all UST
holders at a $1 rate with Tether’s USDT. The report stated that the
crypto brokerage firm paid 620,000 Reais ($127,000). The exchange
paid the amount to compensate all its customers who lost money due
to the Terra ecosystem collapse. Related Reading |
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“FatMan” of the Terra research forum commented in a tweet on May
20 that the decision might set a global precedent for other
crypto exchanges. The tweet stated; This is fairly significant. A
Brazilian cryptocurrency exchange has refunded all UST holders at a
1:1 rate with USDT. Likewise, this case may be used as key
precedent to argue that exchanges are liable for UST losses. If
tortious misrepresentations were made. UST Back At $1 For Those
Lucky Ones The exchange stated that it would refund the customers
the amount of the difference between the present rate for UST and
the dollar peg it collapsed from. This implies that a holder of 100
UST at $0.06 will receive a refund of 94 USDT. According to Nox
Bitcoin CEO Joo Paulo Oliveira, the firm is not responsible for
bearing clients’ losses from investing in certain currencies on its
platform. Yet, they decided to intervene to ensure their customer’s
trust. He continued; Clients have trusted us with staking and we
understand that their trust is much more valuable than anything
else. As a result, we’re going to reimburse these users minus the
expenses we’d have elsewhere, like marketing. The news came as a
relief and brought positiveness to the cryptocurrency space.
However, the decision by the Nox Bitcoin exchange reflects the
Brazilian customer protection regulations. The exchange also offers
staking services, such as Anchor Protocol, which UST heavily uses.
The DeFi protocol offered up to 20% APY on UST staking and was
primarily seen as being instrumental in its collapse due to these
unsustainable yields. People are now waiting to see what happens
next regarding listing UST and LUNA. “It is possible that this will
no longer exist in the near future,” stated Oliveira before adding,
“but you never know what can happen in an unpredictable crypto
market.” Related Reading | Cosmos (ATOM) Skyrockets 12%
Following Bitcoin And Ethereum Recovery According to Tradingview,
UST is trading at $0.067 with a 1% increase at the time of writing.
The “unstablecoin” has withdrawn 93% from its peg. And it is
unlikely to get back to it without major intervention such as a
TerraForm Labs hard fork. Also, TerraForm’s LUNA has dumped a
similar amount. As a result, the coin is trading at $0.00020 with a
market cap of $1.35 billion and 6.5 trillion tokens in
circulation. Featured image from Flickr, and chart from
Tradingview.com
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