MakerDAO's nanexcool recalls Web3 veteran who predicted $UST and $LUNA collapse 4 years ago Terra LUNA
In a statement cited by a blockchain veteran Linda Xie, former PM of a cryptocurrency exchange major Coinbase, Mr. Younessi bashed the idea to solely back UST with the LUNA token.
In 2018, he compared this design to MakerDAO's DAI, but if the latter were only backed by the MKR asset. This"one-asset" backing is too fragile: investors' panic would easily launch a"death spiral" mechanism when two cryptocurrencies — a stablecoin and its"basic token" — would be racing towards zero.
He also recalled the tragedy of the first-ever algorithmically-backed stablecoin NuBits that collapsed in Q2, 2016; Mr. Younessi was surprised that some teams are still interested in similar designs.Mr. Conti also attached a statement on Three Arrows Capital's Su Zhu, one of the largest investors decimated by Terra collapse. Mr. Zhu allegedly"failed to realize" how fragile the LUNA/UST ecosystem is.
As previously covered by U.Today, thanks to the large-scale withdrawals from over-hyped Anchor Protocol and subsequent panic selling, TerraUSD stablecoin lost its peg to the U.S. dollar.
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