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Terra: CEO needs police protection - contingency plan to save LUNA

 


Terraform Labs CEO Do Kwon's family needs police protection, according to a report by Money Today . An unknown person is said to have gained access to the building where the family lives and demanded to speak to Do Kwon at the door of the apartment. After the police were alerted, he fled.


The collapse of LUNA and the stablecoin TerraUSD (UST) has caused billions of dollars in damage so far. Investors around the world have been completely ruined. The moderators of the Terra sub-reddit even felt compelled to post a list of international emergency numbers to support community members who are contemplating suicide.


The collapse of the algorithmic stablecoin and the damage it caused are unprecedented. Many small investors are particularly hard hit, who have often invested their entire fortune solely on Terra and now do not know how to compensate for the loss.


Crazy contingency plan to save LUNA and UST

In the past few days, Terra's circulation has increased to 6.5 trillion LUNA. The reason for this is relatively simple. More and more investors tried to exchange their UST for LUNA. Through the mint burn mechanism, UST was annihilated and more LUNA was emitted.


LUNA lost its value within a few days, exchanges stopped trading the cryptocurrency along with UST. At the beginning of May, the cryptocurrency was still quoted at 84.31 US dollars, now it is worth 0.0002397 US dollars.


CEO Do Kwon apologized to investors and the community via Twitter. He also published a contingency plan that aims to shrink the gigantic circulating supply to 1 billion LUNA. This is intended to stabilize LUNA and to protect the interests of all parties involved via a distribution plan. However, there are considerable doubts that this will be successful. Except for risk-taking speculators, it is unlikely that anyone will be found to give LUNA or TerraUSD a chance after this catastrophe.


Where are the Luna Foundation Guard bitcoins?

The whereabouts of around 2 billion US dollars in Bitcoin is also unclear. The equivalent of 750 million US dollars of this was borrowed in an early phase of the crisis, although it is unclear who the parties involved in the deal were. So far, no public statement has been made on the whereabouts of the lion's share of the Bitcoin reserve.  


The reserve was originally created because it was understood that an exceptional situation could arise and UST would lose its price maintenance. The Bitcoin reserve was intended to support the system if necessary and bring it back into balance. In addition to Bitcoin, attempts were made to diversify the emergency reserve with Avalanche (AVAX) and other stablecoins.


In the aftermath, the question arises as to how and whether the reserve was used. If funds should still be available, it would also be up to you what you want to do with them. In any case, the Bitcoin address on which 70,736 BTC of the LFG were stored was cleared during the crash. The aftermath of Terra, its CEO, and the LFG is likely to be no less problematic than the crash itself.

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