Why This Small Cryptocurrency Kept Making Waves on Thursday

The price of cryptocurrency Waves (CRYPTO: WAVES) has had an exciting week. As of 12:45 p.m. ET today, the price per token is only up 1.5% over the previous 24 hours. But the price has roughly doubled over the past week. And it's likely due to increasing optimism for the Waves ecosystem, which includes stablecoin Neutrino USD (CRYPTO: USDN).

As a stablecoin, the price of Neutrino USD should always be $1. But it is more similar to failed stablecoin TerraUSD than to a stablecoin like Tether, which is backed by U.S. dollar reserves. And from May 9 to May 12, the price for Neutrino USD dropped all the way to $0.75, according to CoinMarketCap.com.

TerraUSD was collateralized by Luna (now called Luna Classic). The supply could increase or decrease by minting and burning new tokens in accordance to demand with an exchange mechanism between TerraUSD and Luna Classic. At least that's how it was supposed to work. In reality, the two tokens ultimately entered what's called a "death spiral" and couldn't pull out.

Source Fool.com