1/ Terra’s integration with @WalletConnect — open-source protocol designed for dapp<>wallet connectivity — is now live, enabling users to access full Anchor, Mirror & Terra Bridge functionality through Terra Station.
2/ By deep linking each web application with Terra Station mobile, @WalletConnect enables users to simply manage their assets across the entire Terra ecosystem on the go.
Download Terra Station mobile & connect your wallet on the front page of the Anchor/Mirror/Bridge web app👇
4/ Specifically for @anchor_protocol, the team has made the following changes to protect users:
1. Borrow limit graph (on the borrow page) has been changed to LTV 2. Max. amt users can borrow: now 40% (as liquidations still happen at 50%)
Payback loans on mobile.
5/ Anchor, Mirror, and Terra Bridge join CHAI to support deep linking to Terra Station via WalletConnect.
It’s beautiful to see the Terra ecosystem maintain its core simplicity even as it scales.
1/ A great video clarifying by YouTuber CryptoCents on some of the misconceptions around TerraUSD ($UST) and how the broader Terra economy works.
Check out his profile and give this man a follow #LUNAtics.
2/ “LUNA is not an asset that explicitly collateralizes UST -- it simply absorbs the short-term volatility of UST.”
UST is backed by the demand for the Terra ecosystem, not explicitly the asset price of LUNA collateralizing the system.
3/ Hence, why an FDNV of LUNA approaching the outstanding liabilities of circulating UST does not trigger a “death spiral” bank run characteristic of traditional endogenous collateral models.
1/ Extreme volatility produced a series of collateral effects across the Terra ecosystem, primarily derived from the short-term peg deviation of $UST and its impact on the volatility of $LUNA and levers of the Terra protocol. There’s a lot to unpack, so let’s dive in 👇
2/ Let’s start with the basics. The Terra protocol mechanism is quite simple:
When the supply of Terra stablecoins (like UST) goes up, the LUNA supply goes down.
When the supply of Terra stablecoins goes down, the LUNA supply goes up.
3/ As an algorithmic stablecoin network, Terra is akin to a decentralized, open-source central bank.
2/ With the threshold currently passed and roughly 96% of votes reporting "No," the community pool will be swapped out for $UST after Columbus-5 and used to bootstrap Ozone. More details will follow after the conclusion of the current voting period.
3/ The community's decision reflects the idea that community-funded growth from the treasury for a blossoming DeFi ecosystem on Terra is the optimal path forward for the network to maximize value and adoption in the long term.
For the first time in Terra’s history, seigniorage distribution to the validators/delegators and the community pool has occurred due to the sharp increase in UST demand -- equating to 24 million LUNA. This is NOT newly minted LUNA.
For some context, the Terra blockchain records "decreased LUNA supply during a week" as accrued seigniorage. The seigniorage is spent in two ways:
1. Oracle rewards: distributed to validators + delegators as staking rewards => increase staking rewards (released over 52 weeks).
2. Community pool: the treasury for the community.
As @mirror_protocol gains traction, it’s important to denote the mutually beneficial relationship between Terra, LUNA stakers, and Mirror’s adoption. Rather than purely being a synthetic assets protocol, Mirror’s adoption accrues value to LUNA stakers.
How does it? Let’s follow UST, Terra’s USD-pegged stablecoin. At a high level, Terra’s LUNA collateralizes its cadre of stablecoins, including UST.
When UST is trading above $1, arbitrageurs can burn $1 of LUNA to mint 1 UST and sell UST on the open market for a profit. When UST trades below $1, then arbitrageurs can buy UST on the market at a discount, and swap it for $1 worth of LUNA.
What are we passionate about? Founders getting to market as efficiently & frictionlessly as possible.
How do we make that happen? Free access to launch capital covering audit costs for selected projects. To be considered, projects must incorporate $LUNA, $mAssets, $UST (TerraUSD) or any of our other interchain stablecoins, in a meaningful way.