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Terra Blockchain Will Split, Abandon Collapsed UST Stablecoin (bloomberg.com) 66

Posted by msmash from the how-about-that dept.
A proposal by the founder of the troubled Terra ecosystem to salvage the project was approved, averting a total collapse of one of the most-watched experiments in decentralized finance. From a report: Under the newly approved structure, the original blockchain will be known as Terra Classic, while its native token Luna, which plunged close to zero this month, will be renamed Luna Classic with the ticker LUNC. The new Terra blockchain will start running a coin under the existing Luna name and ticker, and won't include the TerraUSD stablecoin.
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Terra Blockchain Will Split, Abandon Collapsed UST Stablecoin More

Terra Blockchain Will Split, Abandon Collapsed UST Stablecoin

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  • Classic Classic (Score:3)

    by FictionPimp ( 712802 ) on Wednesday May 25, 2022 @10:02AM (#62564780) Homepage

    The next time it fails they can pump and dump again with classic classic!

    • Re:Classic Classic (Score:5, Interesting)

      by Rosco P. Coltrane ( 209368 ) on Wednesday May 25, 2022 @10:32AM (#62564876)

      I was watching a documentary on this "disaster" that wiped out 45 billions overnight the other day: they interviewed a bunch of investors who were crying in front of the camera that "they had invested their life savings into this stable coin that had a guaranteed return of x% and now they were skint". ...

      Well sorry, but I have no sympathy. If you're too stupid or too greedy (probably both) to know that "guaranteed return" - especially very high returns - means Ponzi scheme and you sink your children's inheritance into that and you get burnt, you deserve everything you get. Especially after Bernie Madoff: it's impossible in 2022 not to know what a Ponzi scheme is.

      Same as with people who send money to Nigerian princes: I'm not sure how those people figure they are victims, and they have a right to go on television and elicit pity for what happened to them, but they really don't deserve any: they were greedy and they got scammed. Cry me a fucking river. If I was in that situation, I'd go and hide somewhere out of shame.

      • Re: (Score:1, Insightful)

        by allcoolnameswheretak ( 1102727 )

        Thanks for your comment Mr. Gloat. Too often cynicism is confused for insight.
        There are quite a few reasons why Terra/Luna collapsed. Bad design, flawed assumptions, unstable mechanics... but being a ponzi was not one of them, unless you really stretch the meaning of the word ponzi to a situation where a market in general is expanding due to fresh money flowing in.

        • Re:Classic Classic (Score:5, Informative)

          by gabebear ( 251933 ) on Wednesday May 25, 2022 @11:34AM (#62565080) Homepage Journal
          Thanks for your comment Crypto Bro,

          Crypto is full of Ponzi schemes and Terra is now the cautionary tail that will likely bring regulators down like a ton of bricks on a lot of these schemes.

          What's funny is this isn't even the first time the founder of Terra has done this. Do Kwon(Terra's founder) previously attempted to defraud investors when he founded "Basis Cash". The SEC intervened and forced Do Kwon to return the money with Basis Cash. Terra/Anchor is currently being investigated as a Ponzi scam in Korea(Do Kwon's home country). https://techcrunch.com/2022/05... [techcrunch.com]

          • Not to burst your bubble, but an investment going from Hero to Zero also is not exclusive to crypto and also happens in traditional markets. Check stock price of Wirecard AG.
            https://en.wikipedia.org/wiki/... [wikipedia.org]

            But yes, crypto is more exposed to this sort of risk. It's emerging tech and most of these projects are spearheaded by kids who think they have all the smarts in the world, but lack wisdom and responsibility. And pretty much nothing is regulated yet.

        • Re: (Score:3)

          by ceoyoyo ( 59147 )

          Promising unrealistic guaranteed interest for investing in a scheme that doesn't actually do anything is absolutely a Ponzi scheme. You can't just say "growing market" and pretend like it's buying into a mutual fund or something.

          Terra also had lots of stupid shit going on *other* than being a Ponzi scheme.

      • People don't make good decisions under pressure. If you're dumping your life savings into crypto it's probably because you don't have much money and you can see your savings are running out as inflation, rent, the cost of your kid's school, etc, etc devour what little you have. You know something has to change or everything will go to shit, but you're already doing your best.

        So you're under pressure and you make stupid mistakes as desperation sinks in. You're vulnerable to scammers.

        There but for the
        • I think more based on the individual than pressure. Some people are naturally suspicious of the guaranteed high returns, while others are not. I am very suspicious. I know others who have taken the crypto plunge.

          • It became clear to me relatively early on that unless you were in very early on cryptocurrency you needed a big pile of money to make money with it, and it was just speculation by that point for investors. Only unless you are sufficiently well-connected, you don't know enough to speculate. Kind of like any money system really, except this one doesn't have enough transparency, nor enough controls.

        • Re:I'm still empathetic. (Score:5, Informative)

          by hey! ( 33014 ) on Wednesday May 25, 2022 @02:31PM (#62565650) Homepage Journal

          It's not just pressure; it's economic illiteracy.

          I'm old enough to remember a time when most middle class people just had saving accounts, maybe a whole life insurance policy, and a pension plan managed by someone else. Now people are expected to function as their own fund managers, but they don't have even basic education in finance and economics. They've never been taught how a fixed rate constant payment loan works, or the effect of risk on an investment's value.

          This happens in business too; business owners don't have the foggiest notion of the economics of what they're doing. I once worked for a guy who had a nice little business going, but he kept undermining it by diverting money it needed into new projects. So one day I went to him and said, "Pete, have you ever heard of 'opportunity costs'?"

          "Sure," he said. "It's the money you don't make because you missed your opportunity to invest in something." He literally thought he could increase his profits by diversifying into more risky ventures. He wasn't *stupid*. He was actually quite clever, but economically illiterate.

          • It's also the gig economy. Uber doesn't provide 401k's so the only chance of having a retirement is learning to trade or becoming an influencer, which the vast majority of people will fail at.

      • it's impossible in 2022 not to know what a Ponzi scheme is.

        That's quite ironic. While Slashdot users like throwing the term Ponzi scheme around what you miss (while criticising others for the same) is that these do not in any way for the legal definition of a Ponzi scheme. If it did these people would be s royally ducked by the SEC since Ponzi schemes are both illegal and prosecuted when discovered.

        So sure, these people are stupid for not researching their too good to be true investment, but if you're criticising them for not knowing a Ponzi scheme then you can cou

      • >> Same as with people who send money to Nigerian princes

        Many of the people who fall for this and other scams are old and have difficulty reasoning, especially under high emotions. If you've never dealt with this then you're lucky. Asking a older person a seemingly easy question under a even a somewhat stressful situation and having them just sit there and not say anything at all until you prompt them is just heartbreaking. Unfortunately it's really easy to manipulate this type of situation.

    • The next time it fails they can pump and dump again with classic classic!

      i.e. "Thanks for being a being a sucker, err beta tester; want o get in on the next beta test?"

    • The next time it fails they can pump and dump again with classic classic!

      I don't know to mod this funny or insightful since it is a funny remark but also what is probably going to happen.

  • immutable (Score:3)

    by awwshit ( 6214476 ) on Wednesday May 25, 2022 @10:05AM (#62564792)

    Turns out the definition of immutable for blockchains means copy-on-write.

  • Albeit for different but equally sketchy reasons. I'm reminded of when general motors went out of business and got bailed out by the government. They folded the company on paper, made all the stock worthless, used the money that they got from the government to make the rich and well connected shareholders whole and cover their losses, and everyone in anyone who bought stock at retail what's a giant soccer caught holding the bag with literally worthless stock for a company that technically no longer existed.

    • Re: (Score:2)

      by gweihir ( 88907 )

      Yes, pretty much. Criminal in spirit and intent, if not in the legal sense. Hopefully that will change. And yes, gross accumulation of wealth in a few is a sure sign of a very sick society.

    • and everyone in anyone who bought stock at retail what's a giant soccer caught holding the bag

      I assume that this phrase is the result of an overly aggressive spell checker. One that isn't very good, but is trying its best. This is marvelous.

    • Re: (Score:2)

      by DarkOx ( 621550 )

      You think that's bad - look at what was DONE to Chrysler bond holds. All by the hand of your precious government regulatory bodies...

      People are people - most people will lie cheat and steal when given opportunity coupled with general lack of accountability. The bigger a bureaucracy the less accountable anyone generally is. This is actually the ONE and only area where these various crypto pool schemese look better the the government regulated banking/securities industries. You still get ripped off all the

      • this? [slate.com]

        It seems like Obama basically forced them to take care of the pensioners if the small investors wanted a gov't bail out. They could have gone "free market" and turned down the deal. The fact that they did not means those bond holders came out ahead with the gov't vs the free market. Either that or they're really, really bad at math.

  • Anybody that still "invests" in this crap is really beyond help.

  • "Insanity is doing the same thing over and over and expecting different results." (usually attributed to Albert Einstein)

    Investing in this again to see it crash again would be a sign of extremely poor judgement.

  • Why is this clown.. (Score:3)

    by diffract ( 7165501 ) on Wednesday May 25, 2022 @10:15AM (#62564840)
    allowed to do more experiments with people's money again, instead of being put behind bars?

    • allowed to do more experiments with people's money again, instead of being put behind bars?

      This is digital... it's different...except for the suckers...

    • instead of being put behind bars?

      What did he do that was specifically illegal? Not some weird twisted interpretation of the law, but honest to goodness textbook illegal?

      Laws can't be made up on the fly or retroactively to just "put people behind bars" because they did something you don't like.

      I'm not a crypto-fan either. I just don't invest it in. For those that do - take the Luna collapse as a (potentially expensive) lesson.

      • Depends what he promised. If he promised it would be stable and guaranteed it, that would be fraud. I did not follow it closely, but I thought that is what he did.
      • Well some argue it was setup as a pyramid scheme, The whole paying 20% interest and not having anything remotely close to sufficient backing does lend Creedence to that. Pyramid and Ponzi schemes in and of themselves are illegal.

    • Losing money is not illegal. Handling money of stupid people isn't either.

      The reason these people aren't being bars is because they actually understand what is and isn't illegal.

  • This time it will be different (Score:5, Insightful)

    by enriquevagu ( 1026480 ) on Wednesday May 25, 2022 @10:19AM (#62564850)

    I promise!

    • Re: (Score:2)

      by DarkOx ( 621550 )

      oh and remember with crypt-currency nobody can just print more of it!

      No no we didn't just issue a whole bunch of new coins out of thin air! There are still the same number of Terra coins but those are just Terra classic now.

      Oh so you'll exchange the classic coins for the new ones at some parity value before your platform emulated Amber Heard on the bed sheets?

      Well...

      Oh no? you wont? I am Shocked...

  • "its native token Luna, which plunged close to zero this month, will be renamed Luna Classic with the ticker LUNC" Shouldn't this be launched as "CLUNK"? That's about how it's likely to land.
  • is still just polishing a turd

  • Gee, after almost a whole day without crypto stories, I was getting strung out.

  • That is it, I'm starting my own blockchain. This new blockchain will have the ultimate in transparency, everything recorded in a public immutable blockchain. The blockchain will be completely decentralized with no governance, no way to make any changes ever.

    My new blockchain will be called the Ponzi network. The Ponzi network will be based on a stablecoin called the FRAUD token (Financial Reward Acquired under Deception).

    I know you diamond hands apes are ready, Join the FRAUD Discord channel for all the lat

  • Good luck getting people to invest in a 2.0 version of this blockchain. Everyone who got burned is out, and anyone new will steer clear independent of whether the algorithm is sound.

  • Fool me once, shame on you,
    Fool me twice, shame on me.

    You must be a complete idiot to invest in this project ever again. I don't know what its owners are thinking but I guess they have no shame whatsoever. If I were them, I'd shut down the project for good no matter if it was legit or not (and I've got a feeling it was a classic Ponzi scheme).

    • Honestly, don't we know exactly what they are thinking? Praying they can get some of their money back?

      In a sane world, this would be the beginning of the end for crypto, but we know it won't be.

  • Crypto exchange ads now run side by side with those of "sports books" during televised sporting events.

    That should tell you all you need to know.

  • Not since 1637 has so many, lost so much, for so little reason....

    With more to follow.

  • Farts out of dicks
  • I'd say that it was predictable, and many investors didn't believe in Stablecoin. Nowadays, it's pretty obvious that it's better to invest in bitcoin because many people believe that it has a bright future. And according to the metcalfe’s law in bitcoin [quantpedia.com], its value depends on the number of active users, so it's definitely a good idea.

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