LUNA’s two coin system recently crashed, which has become the critical talk of the crypto town. Due to its similarity to TerraUSD, a stablecoin pegged to the US dollar; Luna experienced a price drop. Stablecoins are digital currencies tied to real currencies, and prices plummeted when the US dollar decoupled from it earlier this week. When UST lost its peg, it was evident that algorithmic stablecoins are inherently faulted assets. Its value plummeted as a result of this. On Wednesday, Binance briefly banned withdrawals on Luna, and the Terra blockchain was fully terminated on Thursday night as a result of the Terra ecosystem meltdown. Let’s understand various lessons from this crash in this article. Crisis management requires more than on-chain oversight The best option was to put the mint/burn gauge on hold. This would freeze UST liquidation into a tiny LUNA order book, however removing the gauge would necessitate a 7-day vote per protocol design. Delays in governance resulted in inferior choices. Rapid decision-making is required for crisis management The buffet offered to invest in Lehman Brothers at a price that angered the CEO in 2008. However, Lehman pushed Buffet to invest months later, but he declined. Therefore, it is not about the money, but about trust and reputation. Lehman did not listen to Buffet and crashed later. The global financial crisis of 2008-09 was a disastrous event in the financial services industry’s ...
Coinbase Challenges WBTC Delisting Lawsuit
