Terra refers to an open-source blockchain protocol that underpins algorithmic stablecoins and a growing network of financial applications.
Terra also refers to one of the two main cryptocurrency tokens under this protocol, the other one being Luna.
Terra stablecoins track the price of fiat currencies like the U.S. dollar and euro, while Luna is used for governance and mining.
The Terra protocol maintains the price of the Terra stablecoin by ensuring that supply and demand for it are always balanced. This is achieved by using Luna as the variable counterweight to the Terra stablecoin.