Thread by @GabrielGFoo

Why is Terra (@terra_money) unique and should not be compared to other Layer 1 Blockchains like Ethereum, Solana and BSC.

My thesis on Terra, $LUNA and $UST 🌔

A thread on 3 fundamental ideas🧵 👇

1 / Terra is not competing against other L1 blockchains to be the best blockchain. It is competing to be the best form of decentralized money.

In his podcast with @delphi_digital, Do Kwon encapsulates the entire ethos that Terra is built on:

"Our main goal, and the only product that we look at is the Terra stablecoin. Our goal is to make that stablecoin the most decentralized and useful form of money there is. For everything else it’s just a means to an end." —@stablekwon

The phrase "For everything else it's just a means to an end." really struck a chord with me. While it is true that us #LUNAtics always harp on the point that more than 100+ dApps are in the pipeline waiting to launch with Columbus-5 being the catalyst, tons of new use cases..

However, we tend to forget the fundamental question of:

"Why does it matter?"

Every dApp launching on Terra (or dApps which have already launched) makes Terra stablecoins better to hold, easier to spend, and more attractive to invest.

That's why we have world-class dApps like @anchor_protocol, @mirror_protocol, #CHAIPay, @pylon_protocol and many others waiting to launch like @mars_protocol, @prism_protocol, @astroport_fi, @alice_finance creating countless use cases for the Terra ecosystem and its stablecoins.

Ultimately, every dApp built on Terra is all just a means to an end; and that "End" is to create the most decentralized and useful form of money there is.

2 / Terra is chain agnostic.

"So if Terra succeeds as a L1 smart contract platform, then great why not. But from our perspective, we place no difference between $UST being used on the Terra blockchain versus Ethereum or Solana or Avalanche."

The beauty of Terra is in the simplicity of its price stability mechanism:

For every $UST minted, the equivalent dollar's worth of $LUNA is burned.

It does not matter where $UST is used, be it on other L1 blockchains like Ethereum and Solana, or even centralized exchanges like Binance.

As more $UST is minted, $LUNA will be increasingly becoming more scarce as more LUNA will need to be burned.

With Columbus-5 and the implementation of Wormhole V2 and @cosmos's IBC, we can expect to see the Cambrian explosion of $UST being used in every exchange, decentralized and centralized. A bet on LUNA is a bet on the success of its stablecoins.

3 / Terra's total addressable market is every sovereign currency in the world.

Creating the most decentralized and best form of money is not exclusive to the USD-pegged $UST stablecoin. Anyone can create Terra stablecoins pegged any currency on the planet.

I'll let you do your own research on the world's total market cap of all fiat currency, but to put things into perspective:

The Top 3 Stablecoins by market cap (as of this tweet) has a combined market cap of about $115 billion, while $UST has a market cap of $2.7 billion. 👀

That being said, there are still major obstacles that Terra and its stablecoins will need to overcome to achieve widespread mainstream (e.g. building infrastructure and global acceptance) but I'll save that for another thread.

Disclaimer: I am heavily invested in $LUNA and its ecosystem, but this should not be taken as financial advice, do your own research and come to your own conclusions.

I'd like to hear your thoughts as well, thanks for reading!

Link to @Delphi_Digital's podcast between @stablekwon and @ZeMariaMacedo in reference: