What happened? Terra debacle exposes flaws plaguing the crypto industry

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Terra has unfortunately been the unintentional whistleblower that pointed out stablecoin flaws and questioned their real-world utility, but what happened for LUNA to drop from $85 to $0.00003465 in less than 10 days?

“These purchases resulted in an oversupply of UST, which started falling rapidly once sell pressure began to mount on LUNA and then subsequently on UST. Once this selling happened, the Luna Foundation Guard had to offload its Bitcoin to maintain the peg. But, the reflexive sell pressure continued and all of the involved assets began to drop hard.

“Once the Binance liquidity dried up, Curve’s two UST pools started selling UST, and Anchor’s borrowing levels declined by over $1 billion. As a result of this, the broader ecosystem has now been plagued with confidence issues, especially when it comes to stablecoins.

To this point, Terraform Labs’ official Twitter account revealed that all network activity had been stalled at block height 7,603,700. With LUNA’s value dropping by nearly 100%, the firm’s spokesperson suggested that developers are no longer confident in their abilities to prevent third-party governance hacks.

“The LUNA situation will, unfortunately, leave a bad taste in everyone’s mouth as this has caused a lot of great altcoins to lose tremendous value. But, a bigger more important aspect of this development is its timing. All this has happened at a time when there is a war raging in Eastern Europe, supply chains are being constrained globally, inflation and interest rates are rising.

Thus, it will be interesting to see how this story continues to unfold and what sort of repercussions this incident has on the development/evolution of the cryptocurrency market at large, especially as the traditional finance system also continues to be ravaged by a growing amount of adverse financial pressure.

 

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Hopefully its pull backing

Luna is Back

Buy Luna

Luna is slowly coming back

What are the flaws? Tether doesn't work like UST and that won't happen with this stablecoin.

Revolut does not allow to move bitcoin out. Basically it keeps it hostage. You can move out £1000 worth of BTC per month. It's not smart, it's banking mindset which is dead. Be careful beautiful people

what happened is that they let one man take hold of all company decisions and he drove success into ruin just like that. This is why the DAO model such as with the case of BitDAO is a much better alternative, and is a model that is gaining popularity fast amongst users

I’m staying in the terra club .. bin here since day one

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tfw you say that Tether has flaws, but your stablecoin drops in price by 90% 🤣

stfu!!! just because you want it to fail with shit blogs doesn't mean the community does

Can any of my friends tell me what will happen to Luna?

Crypto industry is far away from being stable. I think it can nvr b, so just make your profits, then wait for such crashes which r bound 2 hppn & again make profits. I lrnt in 7 yrs. Nvr hodl old coins, always hodl new coins in small investment

I play easy games and get rewards each time I play on RubyPlayNetwork the most legit platform BSCGems BSC

Someone made Terra version of this and now its gone lol

I will not be surprised how all crypto will be fucking in a year

This happened

🤔🤔🤔

Crypto doesn’t gives u da chance to see the red flags 🚩 till it happens, as well no green flags to make u prepare for takeoff , I won’t be surprise if Luna goes back to $0.5 in few days. 💥💥💥

we need to distinguish collateralized vs. algorithmic

I buy the news $Luna

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