Collapse of UST is the end of algorithmic stablecoins, says Tether co-founder.

June 2, 2022

After Terra’s UST’s collapse, algorithmic stablecoins are unlikely to survive, the co-founder of digital currency tether Reeve Collins told CNBC.

Earlier last month, UST’s collapse triggered a widespread crash in the crypto market.

Reeve Collins said that it’s not a surprise that an algorithmic stablecoin lost its peg with dollars and crashed.

However, CEO of Circle Jeremy Alliare said he thinks people will continue to work on algorithmic stablecoins.

Circle is behind the stablecoin USDC.

The recent UST collapse has attracted the attention of regulators from around the world.

Terra is still trying to gain back the community's trust by offering LUNA 2.0 and other schemes to compensate investors.