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Jon Wu, head of development at Aztec Community, recaps a traditionally chaotic week within the Terra ecosystem that noticed $UST depeg, Anchor depositors flee, and $LUNA fall 99%. Present highlights:

  • how $UST, $LUNA, Luna Basis Guard (LFG), and Anchor Protocol are imagined to work
  • why Jon compares the Terra blockchain with VISA, LFG with the Fed, and Do Kwon with Jerome Powell
  • how a earlier $UST de-peg foreshadowed this week’s dystopian value motion
  • how a bitcoin quick appeared to have kickstarted $UST’s depeg and why Jon thinks it was a deliberate assault
  • why Luna Basis Guard initially bought Bitcoin – and the way that plan backfired and made the Terra dying spiral much more violent
  • why $UST had such low liquidity this week – making it extra vulnerable to a financial institution run
  • what Jon’s predictions are for $UST and $LUNA going ahead
  • what have been the explanations behind Terra halting
  • why Jon doesn’t suppose this would be the finish of algorithmic stablecoins
  • why Jon thinks this could not have an effect on ETH immediately, although there’s a excessive quantity of staked ETH within the Terra ecosystem

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Episode Hyperlinks

Jon Wu

Jon’s Write-Up on the UST Depeg

Earlier Unchained Protection of Terra

  • Do Kwon on backing UST with BTC
  • Kevin Zhou on the danger of UST’s dying spiral

Terra:

Different Recaps on Terra: