Chainalysis: Two traders are behind the collapse of the Terra ecosystem
Analysts have found out who may be behind the collapse of the Terra ecosystem, which cost the entire industry about $ 60 billion.
The collapse of the TerraUSD (UST) stablecoin, as well as the entire Terra ecosystem, was provoked by only two traders. This was reported by Chainalysis analysts in their report.
The collapse of Terra is unfolding
According to experts, it all started on the night of May 7, when Terraform Labs withdrew 150 million UST from the 3pool liquidity pool as part of a planned operation. Such a large and unique operation, according to analysts, increased the volatility of the pool.
Just thirteen minutes later, a major trader noticed this loophole and exchanged 85 million UST for USDC to increase volatility.
During the next hour, another trader converted a total of $100 million, which increased volatility.
Consequence: UST has lost parity with the dollar
In response to these actions, Terraform Labs withdrew another $100 million from 3pool. It is claimed that this was done to "balance" the UST share in relation to other stablecoins.
However, at that time, previous large transactions, as well as many smaller ones, had already violated the parity of the UST to the US dollar.
On the same day, as well as on May 8 and 9, three unknown UST holders converted Tether (USDT) into UST for a total of $480 million to save the project and balance 3pool.
Also on May 9, Luna Foundation Guard (LFG) sold billions of dollars worth of bitcoins for conversion to UST. However, already on May 10, the reserves were depleted, and the UST exchange rate still collapsed.
Recall that the UST exchange rate for the UST/USD pair fell from 1 to 0.12 dollars in early May. The native token of the Terra ecosystem also suffered, losing 100% in the price of the LUNA/USD pair
https://coin-signal.com/cryptonews/chainalysis-two-traders-are-behind-the-collapse-of-the-terra-ecosystem/
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