Luna （Luna） / Tether USDEducation
Why Terra’s LUNA & UST Crashed (On-Chain Data): #crypto #web3
Nansen's report just invalidates the popular narative that one hostile party responsible for the crash of Terra’s LUNA and UST.
His report focused on transactional data between 7th & 11th May, 2022; There are 7 wallets played a role in the depeg of UST.
Summary Of Nansen's Report:
"Our on-chain investigation revealed that a small number of players identified vulnerabilities early into the UST de-peg, specifically in the relatively shallow liquidity of the Curve pools securing TerraUSD (UST)’s peg to other stablecoins, and moved to exploit these by:
1. Withdrawing UST funds from the Anchor protocol on Terra
2. Bridging these funds from Terra to Ethereum via the Wormhole infrastructure
3. Swapping significant amounts of UST to other stablecoins in Curve’s liquidity pools, and
4. During the de-pegging process, likely arbitraging inefficiencies between various pricing sources (Curve, decentralized exchanges, and centralized exchanges) by buying and selling positions between CEX and DEX markets.
As such, we refute the popular narrative of one “attacker” or “hacker” working to destabilize UST. The de-peg of UST could instead have resulted from the investment decisions of several well-funded entities, e.g. to abide by risk management constraints or alternatively to reduce UST allocations deposited into Anchor in the context of turbulent macroeconomic and market conditions.
Our analysis was organized in three phases. In phase 1, we analyzed the transaction flow in and out of the Curve lending protocol. We compiled a list of wallets whose transactional activities indicated they may have impacted the de-pegging of UST. Phase 2 of the analysis involved three parts: i) we observed any transactions across the Wormhole bridge that could have led to the UST de-peg; ii) we reviewed the outflows of UST from the Anchor protocol involving the list of observed wallets; iii) we investigated the sale of UST and USDC on centralized exchanges. Phase 3 of the analysis involved the triangulation of this aggregate on-chain evidence, which enabled us to piece together relevant activities and formulate a narrative that explains the UST de-peg. We also identified a list of seven wallets most likely to have played a significant role in the UST de-peg:
0x8d47f08ebc5554504742f547eb721a43d4947d0a (EIP 1559 User)
0x4b5e60cb1cd6c5e67af5e6cf63229d1614bb781c (Celsius)
0x1df8ea15bb725e110118f031e8e71b91abaa2a06 (hs0327.eth)
0xeb5425e650b04e49e5e8b62fbf1c3f60df01f232 (Heavy Dex Trader)
0x41339d9825963515e5705df8d3b0ea98105ebb1c (Smart LP: 0x413)
0x68963dc7c28a36fcacb0b39ac2d807b0329b9c69 (Token Millionaire / Heavy Dex Trader)
0x9f705ff1da72ed334f0e80f90aae5644f5cd7784 (Token Millionaire)"
Noteworthy:
Nansen's report was based on on-chain data & did not take off-chain events that could have led to the depeg into consideration.
The report did not address “the impact on investors, the breakdown of net losses between wallets & the question of what happened to the BTC reserves backing UST.
Terra’s founder, Do Kwon, also retweeted the report.
Do not forget the historical wise saying, "Never invest more than you can afford to lose."
Not a financial advise, I suggest using this only as a guide - Do your own research.
If you have any questions, kindly write in comments below - I will answer them.
Kindly support this idea with your like and comment, thank you.
His report focused on transactional data between 7th & 11th May, 2022; There are 7 wallets played a role in the depeg of UST.
Summary Of Nansen's Report:
"Our on-chain investigation revealed that a small number of players identified vulnerabilities early into the UST de-peg, specifically in the relatively shallow liquidity of the Curve pools securing TerraUSD (UST)’s peg to other stablecoins, and moved to exploit these by:
1. Withdrawing UST funds from the Anchor protocol on Terra
2. Bridging these funds from Terra to Ethereum via the Wormhole infrastructure
3. Swapping significant amounts of UST to other stablecoins in Curve’s liquidity pools, and
4. During the de-pegging process, likely arbitraging inefficiencies between various pricing sources (Curve, decentralized exchanges, and centralized exchanges) by buying and selling positions between CEX and DEX markets.
As such, we refute the popular narrative of one “attacker” or “hacker” working to destabilize UST. The de-peg of UST could instead have resulted from the investment decisions of several well-funded entities, e.g. to abide by risk management constraints or alternatively to reduce UST allocations deposited into Anchor in the context of turbulent macroeconomic and market conditions.
Our analysis was organized in three phases. In phase 1, we analyzed the transaction flow in and out of the Curve lending protocol. We compiled a list of wallets whose transactional activities indicated they may have impacted the de-pegging of UST. Phase 2 of the analysis involved three parts: i) we observed any transactions across the Wormhole bridge that could have led to the UST de-peg; ii) we reviewed the outflows of UST from the Anchor protocol involving the list of observed wallets; iii) we investigated the sale of UST and USDC on centralized exchanges. Phase 3 of the analysis involved the triangulation of this aggregate on-chain evidence, which enabled us to piece together relevant activities and formulate a narrative that explains the UST de-peg. We also identified a list of seven wallets most likely to have played a significant role in the UST de-peg:
0x8d47f08ebc5554504742f547eb721a43d4947d0a (EIP 1559 User)
0x4b5e60cb1cd6c5e67af5e6cf63229d1614bb781c (Celsius)
0x1df8ea15bb725e110118f031e8e71b91abaa2a06 (hs0327.eth)
0xeb5425e650b04e49e5e8b62fbf1c3f60df01f232 (Heavy Dex Trader)
0x41339d9825963515e5705df8d3b0ea98105ebb1c (Smart LP: 0x413)
0x68963dc7c28a36fcacb0b39ac2d807b0329b9c69 (Token Millionaire / Heavy Dex Trader)
0x9f705ff1da72ed334f0e80f90aae5644f5cd7784 (Token Millionaire)"
Noteworthy:
Nansen's report was based on on-chain data & did not take off-chain events that could have led to the depeg into consideration.
The report did not address “the impact on investors, the breakdown of net losses between wallets & the question of what happened to the BTC reserves backing UST.
Terra’s founder, Do Kwon, also retweeted the report.
Do not forget the historical wise saying, "Never invest more than you can afford to lose."
Not a financial advise, I suggest using this only as a guide - Do your own research.
If you have any questions, kindly write in comments below - I will answer them.
Kindly support this idea with your like and comment, thank you.
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