Can USTC (formerly UST) re-establish its peg to the US dollar? This question has sparked widespread discussion in the crypto world. From the current market situation, achieving this goal is extremely difficult, primarily constrained by the following factors:

First of all, the trust crisis is the biggest obstacle faced by USTC. The collapse of UST and LUNA in 2022 caused huge losses and severely shook investors' confidence in Terraform Labs and its algorithmic stablecoin model. Rebuilding this trust requires long-term efforts and substantial improvements.

Secondly, the core mechanism of USTC still has fundamental flaws. The algorithmic pegging mechanism that originally relied on arbitrage between LUNA and UST to maintain price stability is prone to triggering a chain reaction under extreme market conditions, leading to price collapse. USTC has not yet effectively innovated this key mechanism, and potential risks still exist.

Furthermore, the recognition of USTC in the current market is extremely low. Its price has long been far below the 1 dollar peg target, trading volume has shrunk, and there is a lack of support from mainstream trading platforms and institutional investors. In this situation, it is difficult to form the liquidity and market consensus required to re-peg to the dollar.

Despite this, the unpredictability of the crypto assets market also leaves a glimmer of hope for USTC. It is not ruled out that powerful investors or institutions may inject funds into USTC in the future, giving it new functions or application scenarios, thus rebuilding market confidence. However, this possibility still seems slim at present.

Overall, USTC faces significant challenges in re-establishing its peg to the US dollar. This requires not only technical innovation but also the rebuilding of market trust and the ecosystem. The fate of USTC will also serve as an important case in the entire algorithmic stablecoin field, warranting the continued attention and contemplation of industry insiders.