Terra, originally known as the Luna token, is a blockchain that supports algorithmic stablecoins. The system allows users to mint stablecoins, such as TerraUSD (UST), by burning Luna tokens. However, Terra ran into major problems when UST lost its link to the value of the US dollar, leading to a collapse in the price of Luna and UST. After this incident, a proposal was approved to launch a new Luna, often referred to as "Terra 2.0", as an attempt to regenerate the previous system. Terra 2.0 uses a Proof of Stake (PoS) consensus mechanism with validators validating transactions and users can delegate their Luna 2.0 tokens to validators of choice to participate in consensus and earn rewards.