What is the real reason for the collapse of the stable UST currency? And you’re going to get it back?

What complicates things is all bitcoin in the closet. Remember when LFG was buying Bitcoin. Do you remember the $1 billion OTC news? This led to a significant rise in the price of LUNA, which allowed large quantities of UST to be seeded.

At the same time, LFG DCA entered Bitcoin with an average price above $40,000.

Now, Bitcoin is being pushed down due to overall expectations that LFG will be forced to sell Bitcoin because of the pressure of linking UST.


Any UST-» BTC replacements now will be essentially losses reserved for LFG, when they could have held currencies instead.

Now, what’s the plan? As of this morning, $1.5 billion has been committed to defending the UST peg to the US dollar, guaranteed against bitcoin reserves. But why?

The deeper the liquidity, the harder it is for any entity to “drill” and move the UST price away from $1.

That’s why Jump Capital and 3AC are subscribers (they were part of the consortium that bought $1 billion from Luna OTC in February). They are experienced and sophisticated traders who are ready to do everything necessary to prevent the UST death spiral.
So what’s next? Friendly market makers are working to hire part of the BTC treasury to buy UST at the market price and maintain the link.

The hope is that there are more BTC guarantees at LFG than pressure from some of the people who manipulate the UST price.

Possible results 1) : The treasury is drained, but UST settles.

For now, the BTC appears to have stopped landing.

2) LFG also seems aware and determined to buy BTC back on a low basis.

There’s a win where:

  • BTC drops to $30,000.
  • UST regains its peg to the US dollar.
  • LFG buys back BTC at lower prices.

Sell BTC, get ready to link, buy BTC; Luna wins!

Better yet, BTC somehow rises to the moon, and we get a situation where despite the difficult situation, the value of the basic guarantees increases, and the protocol ends with additional guarantees.

Source a tweet from jonwu.eth’s Twitter account.

  • Here are the reasons why luna fell by 50% in just 24 hours!!
  • Terra’s stable UST currency collapsed below $0.90 despite the loan from Bitcoin reserves.

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