Terra Blockchain Shuts Down to Stop Phishing Attacks

Layer-1 blockchain Terra has temporarily stopped operating to fight ongoing phishing scams pending a full resolution to the issue, the platform announced on X, as reported by CoinTelegraph. It advised users to avoid interacting with all Terra-linked websites until all issues have been eliminated.

According to Terra, the delays in the resolution are due to third parties. They claim the team has been working “around the clock” to resolve the issue.

Hackers attacked the site last weekend

Terra’s site was attacked by hackers last weekend, which preceded the freeze. They deployed phishing attacks in an effort to scam users. Initially, the platform posted a warning on Aug. 19, advising users not to engage with any sites within the Terra.money domain pending further updates. They gave a similar warning the following day as well.

Terra collapsed in May 2022

The most recent issues hitting Terra follow the full collapse of its digital ecosystem in May last year. When Terra collapsed, the crypto market lost capital of $40 billion, triggering a wave of bankruptcies. UST, Terra’s algorithmic stablecoin, also crashed.

Terra 2.0 was launched to retrieve lost funds

Part of the Terra community launched Terra 2.0, a new ecosystem, to help revive the project and recover users’ losses. Terra co-founder Do Kwon also stayed on, despite fleeing South Korea. Most recently, Bankless Times reported that he had been arrested in Montenegro and charged with fraud in the US.

LUNA lost more value on the latest news

According to data from CoinGecko, the LUNA token lost 22% on the news. It has lost more than two-thirds of its value over the past year.

Given Terra’s track record of serious problems, few industry experts are surprised by the latest development. What’s more, some industry observers have no sympathy for the victims. Redditors say anyone who has a Terra account “deserves to be hacked” because no reasonable person should be in the Terra ecosystem.