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FatManTerra Dec 6, Root cause of Terra’s UST implosion was Terraform Labs (TFL) dumping over $450 million in UST on the open market, three weeks before the ecosystem collapsed I claimed.
New Blockchain Data Reveals Root Cause of May UST Depeg. In his three weeks to Depegg, more than $450 million of UST was dumped on the open market. Four days after the last sale, UST began to collapse.
That entity? None other than Terraform Labs. Details inside. pic.twitter.com/aFfzgpBZ5A
Fat Man (@FatManTerra) December 6, 2022
FatManTerra cited blockchain data collated by anonymous researcher, Cycle_22 has discovered the bankruptcy of Singapore-based cryptocurrency lender Hodlnaut, he said.
Terraform Bot Address Dumped $1 Billion UST
On-chain evidence indicates that TFL dumped over $1 billion in UST via sale on Curve or transfer to Binance. Researchers were able to clarify this. This indicated that all transfers originated from the TFL Curve Bot 2 address, which was also mentioned in the independent audit published.
FatManTerra says TFL weakened curve pool
FatmanTerra tweeted that TFL’s explanation that UST was attacked was false because its developers undermined the decentralized stablecoin curve pool.
According to him, the irresponsible dumping of large amounts of UST in a short period of time has reduced liquidity and significantly weakened the peg.
This massive dump and the $2.7 billion that TFL removed through Degenbox contributed to the overall collapse, according to FatManTerra. This meant that TFL and Do Kwon effectively removed all real dollars in the ecosystem, making it impossible for people to redeem his UST.
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TFL and Luna Foundation Guard recently released an independent audit showing that they did everything to redeem the Bitcoin peg, including using the entire Bitcoin peg defense fund, but the audit , indicating that LFG sent 47,000 BTC to Jump Crypto.
The new revelations add to the bulk of the evidence against Terraform Labs and Do Kwon, who is currently on the run and wanted in South Korea.
Posted In: Terra, Analysis
