First, I want to highlight that a lot of regular, hardworking people lost money because of the crypto market crash over the last week or so. Some people lost all of their money. While money isn’t everything, losing a lot of it sure does feel like it. If you or someone you know lost money in the LUNA/UST crash, know that life is always worth living.
If you somehow don’t already know, terraUSD (UST), a cryptocurrency that is supposed to stay at $1 (aka a stablecoin), is no longer $1. When something is supposed to be $1 and it’s not, that’s usually not good. What’s more, the crypto token that backs UST, LUNA, also lost virtually all of its value. These losses have been widely reported on, and so in all likelihood, this is the umpteen-millionth piece about UST you’ve seen.
But it has to be done because readers will remember me gushing over the Luna Foundation Guard (LFG) – the nonprofit aimed at promoting and stabilizing the Terra ecosystem (which issues UST and LUNA) – announcing it would buy $10 billion of bitcoin to back UST. In fairness to me, I was mostly excited that I was able to write about something that Hal Finney published to the famed Bitcoin Talk forum. But in fairness to … the truth, I was not not excited about the possibility of a bitcoin-backed stablecoin.
All said, I’m going to pack as much as I can into this column about Terra without being overwhelming or unoriginal.
Here goes …