Terra to Terror — Will LUNA ruin all of us?
The promising innovation of money 💰— Terra turned into a financial holocaust ☠ for crypto. With a more than a ❗30% drop in my current crypto portfolio, I thought to share my prediction about LUNA’s future based on various country’s financial crisis.
‘Terra’ down the crypto market — What happened?
Between May 5 to12, UST lost its peg (a.k.a. value) and LUNA is in freefall〽from $87.17 to the nearest $0.00 USD! With over $40 Billion USD Market Cap vanished in 7 days — the LUNA freefall is the worst crash in crypto history, losing approx. $7,000 per second MORE than the world’s richest man Elon Musk and Jeff Bezos earn per second combined!
To LUNAtics, this feels like doing a bungee jump at Bloukrans Bridge. You thought it will be a GREAT Experience of a lifetime but ‘unfortunately’ the Terra guy didn’t do enough safety checks before pushing you off the bridge. Well, we all know how this story ends now.
So… Will LUNA bounce back?
Well… although the crypto market surprised us so many times in the past, it is clear to me that LUNA’s faith will be the same as the person beneath the Bloukrans Bridge — R.I.P. but without I & P. Simply because the current 1 USD is worth 5x more than UST value and 3500x more than 1 LUNA.
This is higher than the US Dollar to the Zimbabwean dollar which grew from 1.5x more to 1000x more in 26 years (1980 to 2006). And now it’s 1E25x more. The only historical truth for Terra protocol is to announce LUNA.N, LUNA.R, LUNA.L with the following conversion rates: 1,000 LUNA = LUNA.N | 1,000 LUNA.N = 1 LUNA.R | 1,000 LUNA.R = 1 LUNA.L | 1 LUNA.L = 1 USD
Unless… Do Kwon and his team are better than Zimbabwe…
Analyst Kelvin Maina wrote: “For Luna to recover, they will need to address the problem and show clearly that such a drop will not happen again. As an analyst, I expect to see a bump in Luna prices after UST is pegged back to the dollar. I also expect the prices to start recovering after the Terra project shows that similar problems will not happen in the future.”
So what is UST’s underlining problem?
“ Luna Foundation Guard and Anchor Protocol are not enough to resist extreme volatility. In other words, they overestimated their power in the market. Using unsustainable incentives and supposedly large enough reserve in BTC to keep them afloat. ”
This scene reminds me of Greece's government-debt crisis. Which was caused by a combination of the Great Depression and the government‘s fiscal policies that included too much spending. (Sounds familiar to Anchor Protocol’s 20% APY right?)
And we all know how Greece slowly recovered… Financial Assistance from the EU! So who will be the EU for Terra Protocol? LUNAtics
Why? Because LUNAtics are forced to avoid the equivalent of default in debt repayment. They simply don’t want to see their $10,000 turned to $1 permanently.
The only question left for Do Kwon and Terra Protocol is:
“Will they take on $40 Billions Debt and survive?”
OR
“Flee like the Crypto King and get featured in the next Netflix Documentary — Terra to Terror: DO not trust KWON!”
👋 Thanks for reading this article! I hope you found it enjoyable! Leave a comment below if you want to discuss any topics on cryptos or have any questions.
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