Quote from: Nivia1st on Today at 09:36:06 AM

Quote from: a298b112 on May 10, 2022, 04:10:06 PM

I guess many of you heard the news about UST going down all the way to ~ 0.60 and even Janet Yellen commented on it. So, can someone please explain it why it happened to UST? What is wrong (?) with it?

the beginning of the problem was because bitcoin crashed. UST is an algorithmic stablecoin backed by the terra(LUNA). when bitcoin crash, luna also followed and this also impacted UST. to keep it stable they use Luna to backed ust. but the scenario didn't go well, ust kept falling and luna couldn't hold it. as a result UST and luna fell very deep.

I would guess that the fact that some manipulators caused it to go down was the main reason. I mean think about it, there were some people who crashed Luna so that Luna team would have to recover and when that happened they used their BTC to short it, because they knew that Luna would have to sell btc and drop the price, and they helped and got the money back from the shorting.

Since, there is no way of recovering without that, Luna kept going for a few days and those whales kept profiting that way and it never really recovered because of it. Luna team is now looking for alternative methods, but whales got the money they wanted out of this.