Conspirators or conspirators? – The dust of the nuclear explosion suffered by Terra (LUNA) and its stablecoin UST is still far from having subsided. The speculations are already going well How? ‘Or’ Whatand even who, is responsible for the disaster. let’s try to dissectas objectively as possible, the first elements of this chain disaster.
First, facts : since the night of May 9 to 10, 2022, the stablecoin TerraUSD (UST) of the project Terra suddenly lost its indexation to the US dollar. It even went as low as $0.30and, although a little bumped up ($0.50 at the time of writing), it hasn’t always not returned to parity with the US currency.
The finding is even more dramatic on the side of the token LUNAwhich collapsed from $63 before the start of the disaster on May 9, at less than 5 cents. Past the dread, some wonder How? ‘Or’ What such a thing could have happened. The trader and analyst Onchain Wizard on Twitter presents first clues (beware, some are pure speculation):
“How to make over $800 million in cryptocurrency by attacking the former 3rd largest stablecoin, the way [George] Soros. Everyone is talking about the $UST attack right now, including Janet Yellen. But no one talks about how much money the striker earned (or how brilliant it was). (…)”
800 million dollars in the pockets of the “destroyer” of the UST and the LUNA?
In this Twitter thread, our speculator believes an attacker took advantage of a drop in cash programmed (for a change of exchange pool). First, the attacker would then have drained even more this liquidity for then resell in bulk his USTs on Binance.
Then comes the Double kiss kool effect. While the supposed “bad guy” was selling off his USTs, the Luna Foundation Guard (LFG) had to sell its bitcoins in an attempt to rally the dollar for its stablecoin. After that, the cascade of various panics could be linked: liquidations leveraged positions, blocking of withdrawals of UST by crypto exchanges increasing the effect bank run,…
At the end of his unfolding of hypotheses, the analyst estimates that the “attacker” could have been done in the $815 million profits with this operation. A carefully concocted plan, which is indeed somewhat reminiscent of when George Soros blew up the Bank of England in 1992.
Rumors are unleashed: “Blackstone”, “Citadel”, “Gemini”, everything goes!
While pieces of how the collapse of the UST (and LUNA) are just beginning to fit together (very slowly, jigsaw-like for now), speculation about ” who “ are even more in the domain of hallway rumors.
One of those crazy rumors is that it’s, hold on tight, the giant bottoms Blackstone and Citadel who would have perpetrated this nasty coup. This, with the help of Geminiwho would have lent them 100,000 bitcoinand even 300,000 BTC in some versions of this rumor!
Besides the denial quick from Gemini on Twitter – claiming that they have never made such loans – a former Goldman Sachs trader, Max Boonenexplains that the thing would have had a priori little interest for the two large institutional funds.
“A) Blackstone is a private equity firm operating under a specific mandate from its investors. Buying bitcoins is not part of that mandate, let alone trying to kill Terra. Also, if the trade goes wrong, they will be prosecuted; if the trade works, they will be paid only a little more. (…)
B) (…) Citadel is more flexible. But 300,000 BTC is $10 billion. Citadel doesn’t have as much cash, the fund is known to have an efficient balance sheet. They would have had to raise funds or mobilize other assets. »
In summary, it is still good too early to know if this panic sell massive and dantesque of the UST was initiated by voluntary manipulations (imaginable), and even more to know by whom (pure speculations). Let’s just hope for now that it’s not consequences too serious by ricochetsas has almost was the case with Tether’s stablecoin USDT. Because he too, in the panic, briefly lost his indexation on the dollar.
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