Arca | Jeff Dorman | Jan 31, 2022
In a very abridged summary, MIM, the asset-backed stablecoin of the Abracadabra protocol, has a massive MIM-UST pool on Curve—the decentralized exchange that focuses on stablecoin trading. These incentivized Curve pools accounted for most of the minting of UST (the stablecoin of the Terra Luna/Anchor protocol ecosystem), whose rapid growth ($11 bn outstanding) helped drive the price of LUNA higher over the last several months. As LPs pulled assets out, TVL across Terra Luna dropped, as did the price of LUNA, and Curve’s TVL dropped as well, while all of the tokens in the Abacadabra/Sesta ecosystem (SPELL, TIME, ICE) fell 30-70%. Meanwhile, prediction markets popped up, betting that UST will lose its peg.
See: Gerry Cotten’s widow speaks out over his death and millions of missing crypto
Dealers were inundated with UST put buyers, and FTX even spun up a UST perpetual future market so traders could short UST. SUSHI, a completely unrelated DEX that was in the process of integrating Sesta and his team (but had not yet begun), also became part of the collateral damage. A historical chain of events that led to billions in losses started with the doxing of an individual. He indeed committed terrible crimes, but as of this writing, he has not been accused of any wrongdoing concerning all of the assets/projects mentioned above.
See: NASAA: Crypto scams are the leading threat to investors in 2022
As a result, most of the issues within DeFi are either very easy to avoid with even a shred of due diligence or discovered immediately due to the public records of blockchain. Thus, simple rules of thumb can be:
- Don't buy things you don't understand
- Understand who the founding teams are and their motivations
- Be careful engaging with super early-stage products without a long track record
- Listen when someone uncovers some important data
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
Related Posts
- &
- $1 billion
- 2022
- About
- across
- affiliates
- All
- applications
- AR
- article
- Assets
- being
- Betting
- Billion
- billions
- blockchain
- buy
- cache
- Canada
- chief
- chief financial officer
- Coindesk
- community
- could
- Crimes
- Crowdfunding
- crypto
- crypto scams
- cryptocurrency
- curve
- DAO
- decentralized
- Decentralized Exchange
- Decentralized Finance
- decentralized finance (DeFi)
- DeFi
- developers
- Dex
- DID
- digital
- Digital Assets
- diligence
- discovered
- distributed
- dropped
- ecosystem
- Education
- Elaborate
- etc
- events
- exchange
- executive
- Face
- finance
- financial
- fintech
- founder
- founders
- fraud
- FTX
- full
- funding
- future
- Global
- Government
- Growth
- helps
- HTTPS
- ICE
- immediately
- important
- individual
- industry
- influence
- information
- Innovation
- innovative
- Insurtech
- Intelligence
- investment
- Investors
- issues
- IT
- leading
- Led
- Long
- LPs
- Market
- Markets
- Members
- millions
- minting
- months
- more
- most
- networking
- Officer
- Onchain
- opportunities
- partners
- payments
- pool
- Pools
- Popular
- prediction
- price
- process
- Products
- projects
- prominent
- provides
- public
- real-time
- records
- Regtech
- Ripple
- rules
- scams
- Sectors
- Services
- Short
- Simple
- So
- Someone
- Speaks
- stablecoin
- started
- Story
- successful
- SUSHI
- Terra
- Theranos
- time
- today
- Tokens
- track
- Traders
- Trading
- traditional
- treasury
- TVL
- usually
- WHO
- within
- without
- worked
- works
- writing
- years