1/ There were a lot of words spoken about $UST / $Luna / #Terra collapse, but can we evaluate the total damage to the DeFi space?
2/ Besides the complete wipe of ~$50b chain a lot of protocols outside #terra were affected as well.
3/ First of all people started removing their money from any risky assets which caused temporary or complete depeg or heavy imbalances in the liquidity pools of most of the algo / pegged tokens.
9/ And many others. But this was investors' decision to abandon these projects, you can not really blame anyone. Unfortunately, there were many projects which suffered huge losses during #terra collapse due to other factors.
10/ @venusprotocol suffered a $13.5m loss because Chainlink oracle stopped updating the price of Luna below $0.1 while the market price was $0.01. This allowed users to lend $Luna and borrow against it 10x more assets than possible under normal conditions.
12/ @groprotocol was exposed to $UST in one of their farming strategies. Team was continuously monitoring the situation, but failed to take necessary actions to prevent huge losses.
13/ They have fallen into the trap of over-reliance on the size of Terra, reputable funds behind and others.
14/ Don't know what is this protocol, but they have lost all the TVL as well
15/ A lot of lending protocols acquired little to huge bad debt due to extreme market volatility and chain congestion. But there is one protocol which did the worst possible thing to themselves and their investors.
16/ @kava_platform hardcoded $ust to $1. Users were able to mint $USDX (native stablecoin from the Kava chain) against UST at 99% LTV without risk of liquidation. After that $USDX was sold for other assets on Kava Swap.
17/ I like @kava_platform, I think this is a promising US based project within the Cosmos ecosystem with IBC transfers implemented, but they have made a horrible mistake.
18/ Own protocol and own stablecoin already have risks involved, why would put on top of that all the risks associated with other stablecoin from another chain? Of course $usdx lost the peg as it was minted against 0 value $ust and dumped on the market right away.
19/ It took several days for the team to change $ust hardpeg to oracle price (which was also much higher than market price, so people were still arbing but with less profit) and then to restirct minting $USDX against $UST.
20/ Protocol has lost ~$300m in TVL or ~50% in a few days. In addition to $USDX collapse and investors faith.
21/ Probably this is one of the worst weeks in crypto history so far. And a lot of people are accountable for that besides Do Kwon and the team. A lot of crypto influencers were promoting Terra heavily and building their wealth and audience around it.
22/ I don't want to call their names, everyone knows them and people will eventually forget about it. But I want to thank those who were trying to warn the community about the risks @FreddieRaynolds@0xHamz@Galois_Capital@JackNiewold and many others.
23/ In my turn I regret that I was too delicate in wordings in my thread about $UST as I didn't want to get a lot of hate from the Terra c̵u̵l̵t̵ community.
24/ This week gave us a lesson that there are even more risks involved in DeFi and you might be indirectly affected by events happening on other chains / protocols.
25/ If you liked this thread, I would love it if you could share it by retweeting the first tweet:
1/ I am writing mostly about DeFi but I have a trading background and occasionally I am posting charts or showing some of my trades. Let's check the #Bitcoin chart.
1/ Solana blockchain is offline and has to be rebooted. Different sources are saying it will take up to 24 hours. I've decided to check what the validator servers look like and why it takes so much time.
Can you leverage stablecoins farms to 100% APY with @YetiFinance? Let's take a closer look.
Thread 🧵
1/ Yeti Finance is a cross-margin lending protocol on #Avalanche that allows users to borrow $YUSD and get up to 21x leverage against their portfolio of LP tokens, staked assets and yield-bearing tokens for 0% interest.
2/ It is important to understand the difference between isolated and cross-margin.
With the cross-margin you can borrow against all deposited funds, while an isolated margin allows you to borrow against a particular collateral at a time.
These days DAOs are holding billions of dollars in the treasuries, but do they really have access to it?
Let's check how they are managing the capital and what can be improved.
Thread 🧵
1/ I have been doing research and I came to know that most of the DAOs (I've checked >70 treasuries) keep all their treasury in the native tokens and do not implement any yield farming strategies.
2/ Billions of dollars are locked up and can not be allocated elsewhere. For example @Uniswap DAO has $2.3b in the treasury (lost another $300m by the time I have finished the thread) and it is stored 100% in $UNI.
This is me waiting for curve rewards for the BEAN:3CRV pool to be added to the Silo on @BeanstalkFarms
Meanwhile let's check how to get up to 300% APR on your stables.
Thread 🧵
1/ If you missed my first thread about $bean, what is algo stablecoin, how does $bean hold the peg and what are the ways to earn with @BeanstalkFarms - here it is:
1/ Disclaimer: I own $UST, $LUNA and a bunch of other coins on Terra. This thread is not about creating FUD, but I am asking reasonable questions and would love to have a discussion and listen to multiple points of views.
2/ What is $UST and how does it work?
$UST is an algorithmic stablecoin which is not backed by any type of collateral as over-collateralized or fiat backed stablecoins. #Bitcoin and #Luna don't act as a backing asset to maintain UST peg.