👉 The market capitalization of $40B vanished overnight.
👉 Billions in wealth destroyed.
👉 Lives and businesses shattered.
A brutal reminder: cryptocurrencies can create dreams—or erase them in seconds.
💥 How it all began
Do Kwon and Daniel Shin launched Terra with a vision: a payment system powered by stablecoins.
• UST (TerraUSD): an algorithmic stablecoin, pegged to $1.
• LUNA: its balancing token, used to maintain the stability of UST.
• Anchor Protocol: offered a 20% APY on UST deposits—too good to hold.
75% of all UST ended up locked in Anchor. Critics warned it was unsustainable.
💥 The collapse (May 2022)
• More than $2B of UST withdrawn in days → UST decoupled to $0.91.
• The panic selling got out of control.
• Exchanges removed LUNA/UST, the Terra blockchain was shut down.
• Total losses in cryptocurrencies: more than $60B.
Big names like Voyager, Celsius, and 3AC couldn't survive the shockwave.
💥 Failed rescue
The Terra Guard Foundation spent billions in BTC reserves to defend UST. It didn't work.
The supply of LUNA hyper-inflated, the price fell close to zero.
“Terra 2.0” was launched but trust had been lost.
💥 The fate of Do Kwon
• Arrested in Montenegro (2023) for false documents.
• Sentenced to prison.
• Facing extradition requests from South Korea and the U.S.
⚠️ The lesson
The collapse of LUNA exposed the risks of:
✔️ Algorithmic stablecoins
✔️ Unsustainable yields
✔️ Little transparency
Forced the entire industry to rethink risk, regulation, and trust.
📊 Prices today
$LUNC = 0.00006015 (+1.53%)
$LUNA = 0.1509 (+2.58%)
🔥 Question: Do you think another collapse on this scale could happen again—or has the market learned its lesson?
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