People in the cryptocurrency industry believed that stable coins, like the Terra coin, are a brilliant idea and predicted that stable coin methodology is the direction that coin methodology would develop in the future. As the name suggests, the purpose of a stable coin is to remain stable, as they are pegged to fiat currency, such as the dollar. Furthermore, the Luna system promised investors an interest rate of 20% per year and made it into the top 10 cryptocurrencies by market cap. 
In the case of the Terra system, one Terra was pegged on one USD by additionally creating a new coin, Luna, that is linked with Terra. One Terra is exchanged for one USD equivalent of Luna, and conversely, one USD equivalent of Luna can be exchanged for one Terra at any time. When the value of one Terra is greater than one USD, people will consume Luna to purchase Terra. The supply of Luna in the market decreases and the supply of Terra in the market increases. According to the law of supply and demand, the price of Terra drops until it reaches one USD. On the contrary, if the value of one Terra is less than one USD, the price of Terra will increase until it reaches one USD.
Some economists pointed out that the high-interest rate is out of common sense and investors will exchange Terra for Luna when Terra coins are over-issued. On May 12, the Terra coin price converged to zero. Analysts presumed the Terra system had collapsed due to the application of huge capital. A certain force, whose identity is not known, bought a large amount of Terra and sold the Terra in a very short time, succeeding in temporarily lowering the Terra price below one USD. The public also sold Terra, fearing the decline of the Terra, and as the fear spread, most people sold Terra and the Terra system collapsed. 
Nobody knows what exactly caused the Terra system to collapse except for the influx of huge capital. Some say that lowering the price of Terra lowered the price of Bitcoin, which was considered the last resort to maintain the Terra. Whether due to fear or an increased supply of Bitcoin, the price of Bitcoin fell by 25% in May compared to the previous month.
BBC News reported that the number of victims in Korea is estimated to be about 280,000. What is certain is that stable coins may be insecure, and that algorithmic stablecoins may not have a future.