The loss of UST's peg and the severe collapse of LUNA resulted in significant damage, both financially and psychologically. This article provides insights into some of the lessons that can be learned from this incident.

Perhaps many people have suffered due to the recent loss of UST's peg and the collapse of LUNA. Money has been lost and the market continues to move on. So, what can we learn from this event? Here are five lessons that I have learned.

A popular way to play in crypto, or any other field, is to follow someone we think is good. And in this case, the investment fund (Venture Capital).

Typically, users who invest in projects have large amounts of money to put down. In the case of Terra, notable investors include Coinbase, Hashed, Delphi Digital, and Binance Labs, all of which are considered top-tier funds in the crypto industry.

Since the beginning of 2021, the price of LUNA has significantly increased from its previous low. Despite this growth, investment funds continue to actively invest whenever Terra calls for capital. Even at a price of 50 USD/LUNA, Terra can easily raise capital in early 2022, demonstrating their confidence in LUNA's future growth potential.

Hashed and Delphi Digital are two particularly strong investment funds, not only for Terra but also for other projects in the ecosystem. Interestingly, Delphi Digital even accepts UST as payment for its Premium account.

In 2021, Terra raised around $175 million, but that amount has now officially dwindled to nothing.

The losses incurred by Terra's investors are not limited to the money invested. For instance, Hashed and Jump Crypto have become validators for Terra, which requires them to lock a large amount of LUNA. Ironically, this locked LUNA can take up to 21 days to be withdrawn and sold on the market. This mechanism was originally implemented to encourage users to stay with Terra, but it now means that this LUNA is considered lost at the moment.

Many people, including myself, often view investment funds as a source of collateral for projects. However, recent cases such as Terra and Sushi have prompted us to reassess the value of venture capital funds in today's age. If we don't do this, are we blindly delegating decision-making power to the funds without preparing for possible failures?

The recent case of Terra highlights the fact that making a profit in the crypto market is much more challenging than it may seem online. While many people may view crypto investing as an easy way to make money, the reality is that it can be very difficult and requires careful consideration and research.

At one point, Terra was among the top 10 crypto projects with the largest market capitalization, and it even came close to reaching the top 5. Additionally, UST was one of the top 3 stablecoins with the largest market capitalization at that time.

Historically, no project in that segment has experienced a price drop of almost 100% in just 4-5 days.

Another popular investment strategy in the crypto market is to buy and hold only high-cap assets or top coins. The rationale behind this strategy is that top coins typically do not lose much value when Bitcoin corrects, and they are less susceptible to scams compared to low-cap projects. However, this strategy often results in lower profits.

Terra's recent experience has demonstrated that even projects with incredibly high market capitalization are still susceptible to attacks and may become almost impossible to save. There are even rumors that Do Kwon, the founder of Terra, sought police protection amid the crisis (details can be found here).

Anchor Protocol has become a popular investment destination for many people due to its attractive feature of offering a 20% annual interest rate paid in UST. This is evidenced by the fact that before Terra's crash, over 14 billion UST had been deposited into Anchor.

Initially, depositing stablecoins into Anchor Protocol and earning a 20% profit in the form of more stablecoins seemed like an easy and attractive investment option. However, following the severe devaluation of UST, many investors have found themselves losing 50% of their investment in just one day, despite earning a 20% annual profit.

In the world of crypto, there is no completely safe way to make money. Any investment opportunity that promises high profits and absolute safety is likely a scam or has questionable intentions behind it.

In this section, I will discuss two topics: Do Kwon's wager and the investment in UST and LUNA during the devaluation period.

1.Do Kwon's Betting Review

Whether the bet takes place at the LUNA price of $88 (whether the 2023 LUNA price is higher or lower than $88, respectively), it is still much higher than the price at the seed, private, or even funding rounds in 2021. However, I still think the odds of winning for Do Kwon were very high.

Because both are betting on Do Kwon's own ecosystem. At that time, although Terra was a potential ecosystem, there were actually some problems with the use of UST.

Users like me can still see these problems. Can't Do Kwon and his team see them as well? Therefore, by simply fixing these issues, it is almost certain that LUNA will continue to grow.

However, everything does not take into account the possibility of someone attacking the 3pool when Terra moves liquidity into UST's 4pool. Although the expiration is still a long way off, we may already know who the winner is.

2.UST and LUNA “bottom fishing” for the time being

Not only me, but many people are taking the opportunity to buy LUNA while the price is plummeting, and they are waiting for the problem to be resolved before the price recovers. Additionally, according to you, buying UST still has a greater chance of winning because it is a stablecoin and is the core of Terra's construction philosophy. So while LUNA may lose value, the team will do their best to save UST.

I initially thought that their funds would help Terra in this incident. However, when Do Kwon raised capital, the funds refused to participate, leading Terra to adjust the parameter to reduce the selling pressure on UST.

Despite the effort, it seems that the adjustments made were not enough for both LUNA and UST to fully recover. As a result, many who participated in "bottom fishing" for UST and LUNA suffered losses.

I wrote an article about UST losing its peg and how Do Kwon may have been too proud of his creation, Terra, to the point of dismissing any criticisms. This may have contributed to the possibility of parties joining forces to attack Terra again.

While it may not be the main reason, Do Kwon's dismissive attitude towards criticism also hindered Terra's ability to find support during its time of trouble. A number of figures who had previously been disregarded or even ridiculed by Do Kwon, tweeted mocking comments about Terra. One notable example was the founder of Cardano, who tweeted the following:

In another instance, during an interview, when asked to predict the failure rate of projects in the market, Do Kwon responded with 95%. What's notable is that afterwards, Do Kwon commented that watching these companies 'die' can be quite entertaining.

While these tweets may not have a direct impact on Terra's ability to raise capital, they contribute to an overall atmosphere of negativity that makes it harder for Do Kwon and the team to manage their emotions while finding solutions for this historic event.

This incident deserves to be put in history because of the level of devastation it caused. Not only financial, even investor spirit.

On Reddit's Terraluna section, I had to pin a post about an emergency number when no one heard or wanted to get advice. In addition, some people act negatively after losing money. In the article about this on Yahoo.com, they must include a phone number if the reader needs health assistance.

It is not clear whether the above cases are real or fake, but given the severity of the recent past, these incidents are not surprising.

Personally, I'm lucky to know how to allocate my portfolio. Although there was partial property damage and psychological damage, overall, the next day was much better. Therefore, in order to survive in the market, in addition to the knowledge of "finding the truss", we need to have a clear understanding of the proper allocation of capital.

Despite having been fortunate enough to overcome the consequences, the Terra incident should serve as an example for investors. What did you learn from this case? Please feel free to comment below for everyone to discuss.

The loss of UST's peg and the severe collapse of LUNA resulted in significant damage, both financially and psychologically. This article provides insights into some of the lessons that can be learned from this incident.

Perhaps many people have suffered due to the recent loss of UST's peg and the collapse of LUNA. Money has been lost and the market continues to move on. So, what can we learn from this event? Here are five lessons that I have learned.

A popular way to play in crypto, or any other field, is to follow someone we think is good. And in this case, the investment fund (Venture Capital).

Typically, users who invest in projects have large amounts of money to put down. In the case of Terra, notable investors include Coinbase, Hashed, Delphi Digital, and Binance Labs, all of which are considered top-tier funds in the crypto industry.

Since the beginning of 2021, the price of LUNA has significantly increased from its previous low. Despite this growth, investment funds continue to actively invest whenever Terra calls for capital. Even at a price of 50 USD/LUNA, Terra can easily raise capital in early 2022, demonstrating their confidence in LUNA's future growth potential.

Hashed and Delphi Digital are two particularly strong investment funds, not only for Terra but also for other projects in the ecosystem. Interestingly, Delphi Digital even accepts UST as payment for its Premium account.

In 2021, Terra raised around $175 million, but that amount has now officially dwindled to nothing.

The losses incurred by Terra's investors are not limited to the money invested. For instance, Hashed and Jump Crypto have become validators for Terra, which requires them to lock a large amount of LUNA. Ironically, this locked LUNA can take up to 21 days to be withdrawn and sold on the market. This mechanism was originally implemented to encourage users to stay with Terra, but it now means that this LUNA is considered lost at the moment.

Many people, including myself, often view investment funds as a source of collateral for projects. However, recent cases such as Terra and Sushi have prompted us to reassess the value of venture capital funds in today's age. If we don't do this, are we blindly delegating decision-making power to the funds without preparing for possible failures?

The recent case of Terra highlights the fact that making a profit in the crypto market is much more challenging than it may seem online. While many people may view crypto investing as an easy way to make money, the reality is that it can be very difficult and requires careful consideration and research.

At one point, Terra was among the top 10 crypto projects with the largest market capitalization, and it even came close to reaching the top 5. Additionally, UST was one of the top 3 stablecoins with the largest market capitalization at that time.

Historically, no project in that segment has experienced a price drop of almost 100% in just 4-5 days.

Another popular investment strategy in the crypto market is to buy and hold only high-cap assets or top coins. The rationale behind this strategy is that top coins typically do not lose much value when Bitcoin corrects, and they are less susceptible to scams compared to low-cap projects. However, this strategy often results in lower profits.

Terra's recent experience has demonstrated that even projects with incredibly high market capitalization are still susceptible to attacks and may become almost impossible to save. There are even rumors that Do Kwon, the founder of Terra, sought police protection amid the crisis (details can be found here).

Anchor Protocol has become a popular investment destination for many people due to its attractive feature of offering a 20% annual interest rate paid in UST. This is evidenced by the fact that before Terra's crash, over 14 billion UST had been deposited into Anchor.

Initially, depositing stablecoins into Anchor Protocol and earning a 20% profit in the form of more stablecoins seemed like an easy and attractive investment option. However, following the severe devaluation of UST, many investors have found themselves losing 50% of their investment in just one day, despite earning a 20% annual profit.

In the world of crypto, there is no completely safe way to make money. Any investment opportunity that promises high profits and absolute safety is likely a scam or has questionable intentions behind it.

In this section, I will discuss two topics: Do Kwon's wager and the investment in UST and LUNA during the devaluation period.

1.Do Kwon's Betting Review

Whether the bet takes place at the LUNA price of $88 (whether the 2023 LUNA price is higher or lower than $88, respectively), it is still much higher than the price at the seed, private, or even funding rounds in 2021. However, I still think the odds of winning for Do Kwon were very high.

Because both are betting on Do Kwon's own ecosystem. At that time, although Terra was a potential ecosystem, there were actually some problems with the use of UST.

Users like me can still see these problems. Can't Do Kwon and his team see them as well? Therefore, by simply fixing these issues, it is almost certain that LUNA will continue to grow.

However, everything does not take into account the possibility of someone attacking the 3pool when Terra moves liquidity into UST's 4pool. Although the expiration is still a long way off, we may already know who the winner is.

2.UST and LUNA “bottom fishing” for the time being

Not only me, but many people are taking the opportunity to buy LUNA while the price is plummeting, and they are waiting for the problem to be resolved before the price recovers. Additionally, according to you, buying UST still has a greater chance of winning because it is a stablecoin and is the core of Terra's construction philosophy. So while LUNA may lose value, the team will do their best to save UST.

I initially thought that their funds would help Terra in this incident. However, when Do Kwon raised capital, the funds refused to participate, leading Terra to adjust the parameter to reduce the selling pressure on UST.

Despite the effort, it seems that the adjustments made were not enough for both LUNA and UST to fully recover. As a result, many who participated in "bottom fishing" for UST and LUNA suffered losses.

I wrote an article about UST losing its peg and how Do Kwon may have been too proud of his creation, Terra, to the point of dismissing any criticisms. This may have contributed to the possibility of parties joining forces to attack Terra again.

While it may not be the main reason, Do Kwon's dismissive attitude towards criticism also hindered Terra's ability to find support during its time of trouble. A number of figures who had previously been disregarded or even ridiculed by Do Kwon, tweeted mocking comments about Terra. One notable example was the founder of Cardano, who tweeted the following:

In another instance, during an interview, when asked to predict the failure rate of projects in the market, Do Kwon responded with 95%. What's notable is that afterwards, Do Kwon commented that watching these companies 'die' can be quite entertaining.

While these tweets may not have a direct impact on Terra's ability to raise capital, they contribute to an overall atmosphere of negativity that makes it harder for Do Kwon and the team to manage their emotions while finding solutions for this historic event.

This incident deserves to be put in history because of the level of devastation it caused. Not only financial, even investor spirit.

On Reddit's Terraluna section, I had to pin a post about an emergency number when no one heard or wanted to get advice. In addition, some people act negatively after losing money. In the article about this on Yahoo.com, they must include a phone number if the reader needs health assistance.

It is not clear whether the above cases are real or fake, but given the severity of the recent past, these incidents are not surprising.

Personally, I'm lucky to know how to allocate my portfolio. Although there was partial property damage and psychological damage, overall, the next day was much better. Therefore, in order to survive in the market, in addition to the knowledge of "finding the truss", we need to have a clear understanding of the proper allocation of capital.

Despite having been fortunate enough to overcome the consequences, the Terra incident should serve as an example for investors. What did you learn from this case? Please feel free to comment below for everyone to discuss.