The real-time collapse of the algorithmic stablecoin TerraUSD (UST) serves as a critical lesson on the inherent differences among stablecoins and underscores the urgency for regulatory measures to ensure their stability and reliability. The UST meltdown highlighted the vulnerabilities of stablecoins that are not backed by high-quality liquid assets within a regulated system, revealing their similarities to financial derivatives rather than stable currencies. The event has intensified regulatory scrutiny and emphasized the importance of trust and transparency in stablecoin operations, as complex systems can fail in unpredictable ways, leading to significant market disruptions. The risks associated with algorithmic stablecoins are not isolated but may also affect larger stablecoins, potentially posing systemic threats to the broader economy if they lack adequate collateral transparency and quality. The necessity for regulatory frameworks that uphold existing financial standards and compliance is evident to prevent such occurrences and maintain market confidence, illustrating that innovation in financial technology should not overlook regulatory oversight and existing monetary rules.