The crash of the Terra network (including its algorithmic stablecoin, TerraUSD, and native token, LUNA) had a huge negative impact on Bitcoin, Ethereum, and the broader crypto market. Even though the crash happened in May, the market is yet to recover from its consequences fully.
Bitcoin’s price has dropped 70 percent from its all-time high and trades around the $20,000 range. Altcoins such as Ethereum experienced steeper declines in their prices. Yet, a controversial cryptocurrency with a $5 billion market cap (Hex) is facing allegations of dumping after its price dropped by 90 percent from its all-time high.
The price of Ethereum-built Hex rose sharply in the last two years. However, many industry players have criticized the network for penalizing those who don’t stake their Hex tokens. Instead, the system rewards those who keep their Hex tokens in what is known as staking.
Meanwhile, a media outlet, Protos, reported that Hex creator and crypto advocate Richard Heart had sold all the BTC and ETH investors used to purchase Hex on its launch date. The report also claimed that Heart had withdrawn all the digital assets from wallets used to receive Hex fees.
Heart declined to comment on the allegation before the Protos published the report. Hex’s price has lost 90 percent of its value after hitting an all-time high in September 2021. Its price drop is deeper than Bitcoin and Ethereum, which had each dropped about 70 percent of their value from their all-time highs.
In a recent interview, Heart revealed that the network plans to launch Pulsechain, the much-anticipated Hex-linked blockchain. Heart and Hex announced the launch of Pulsechain last year, promoting it as an Ethereum fork.
They also claimed it would switch to a proof-of-stake (PoS) consensus mechanism before Ethereum’s PoS switch is complete. At that time, users interested in earning Pulsechain’s tokens (PLS) in an acclaimed airdrop were asked to sacrifice other cryptocurrencies, such as Hex or Ethereum.
Heart told Bloomberg in June that about 45 percent of Hex’s circulating supply is in two crypto wallets and would be swapped for PLS coins at the launch of the Pulsechain. However, repeated delays in the launch of Pulsechain have made some people wonder whether the planned launch will ever occur.
In another interview with Ivan Liljeqvist (a popular YouTuber), the Hex founder said he wouldn’t confirm any schedule for the launch of Pulsechain. Nevertheless, it is unlikely that a Hex collapse would have a similar impact as the terra network crash.
Bitcoin investor, Mike Alfred, explained that a Hex crash wouldn’t affect the broader crypto market because it isn’t tied to the rest of the ecosystem. “It is similar to a parallel economy and will fail in slow motion because of the set-up of the protocol’s reward token lock-ups.” Nevertheless, Heart insists that the Pulsechain launch will boost Hex’s price.
Paul is a cryptocurrency enthusiast from Canada, and since 2021 he has been writing about cryptocurrency for online news portals. He writes mostly news-related articles. Stay tuned to his posts to stay up to date with the crypto world.
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