We know algorithmic stablecoins are new and risky. UST is backed by Luna, and the foundation behind Luna bought so much Bitcoin I believe they're now amongst the top 10 holders.
If UST loses its peg against the dollar and Luna isn't enough to bring it back up, the foundation will have to sell some of its BTC to keep the peg, which applies sell pressure on BTC and brings it down along with the whole crypto market.
Is this what's happening now already?
It was true fact happened a week ago. Total market loss the trust on the crypto currency,it’s like a gambling on investment in crypto currency.But the fact is different from the real,people stop investing and full cash out of crypto currency to Fiat. At the last total people almost cash out and market 2as dam collapsed.So the price of most of the coin reduced.