The Terra ecosystem is caught in a death spiral. What do KOLs in the crypto industry think?

Organized by: Hu Tao, Nian Qing, Chain Catcher

Flashbots Strategic Director Hasu:

UST is worse than Bitconnect. At least Bitconnect didn't disguise itself as a stablecoin. When your Ponzi scheme targets people's savings (rather than investment) portfolios, there is a special place in hell reserved for you. Half of the CT influencers, venture capital firms, and trading companies are complicit.

Rekt:

Whether through regulation or a lack of confidence, this event will severely hinder the mass adoption of DeFi. If DeFi becomes a situation where idols lead users to bankruptcy and large trading firms manipulate the fate of the entire ecosystem, then the original intention of building a fairer system has failed.

Framework Ventures Co-founder Vance Spencer:

The alt L1 trading era is over; people will value future decentralization and stability. Multi-chain is multi-chain eth, modular/data availability is also good, and everything else is not. Cross-chain bridges are a disaster, the economic security of alt L1 is impossible, and most of the driving force behind alt L1 is an inorganic mirage. We don’t need to keep relearning this lesson.

Pangea Fund Co-founder Ryan Watkins:

Reducing the tails that lead to system collapse is necessary for building a reliable system that can become the cornerstone of the global economy. Today feels like the climax of two decades of tokenomics experiments. If there’s anything else to learn besides the impracticality of algorithmic stablecoins, it’s the dangers of reflexive tokenomics. Consider that the era of reflexive tokenomics is dead. In summary, this industry has felt on the brink of death countless times. Cryptocurrency always rebounds. This time will be no different.

Binance Founder Zhao Changpeng:

We are in a new market with many innovations. Algorithmic stablecoins are one of them. When they are hot, they are all the rage. When they crash, it can lead to a vicious cycle. Some innovations will succeed, but many will not. Ultimately, we need to return to fundamentals. Build real products that do not rely on short-term incentives or promotions, but have intrinsic value for people to use. Most importantly, we need to humbly respect the market and not be arrogant. Day by day, step by step, build. The rest is left to the market and time.

The Block Research Director Larry Cermak:

A bunch of cryptocurrency funds in South Korea are going to explode. Very few large cryptocurrency funds have suffered massive losses. The retail market has taken a severe hit, and there are discussions about suicide everywhere on Reddit. Some companies have treasuries in UST. Some businesses are built on Terra/Anchor. This is very scary.

Maker Founder Rune:

What I’m most worried about is all the rumors about ordinary people committing suicide because they can’t face losing their family savings and leaving their families. They are targeted in the most cynical and reckless ways, with no warning about the risks they are taking.

1confirmation Partner Nick Tomaino:

Do Kwon is the leader of this farce, but there are also countless influential "investors" actively pushing LUNA. Remember who they are. Stay vigilant and form your own opinions.

Attracting real founders is also a good truth guide; Terra locked in many hot trends (stablecoins, L1 chains, DEXs, etc.) but did nothing new and different to push the space forward. They even actively attacked legitimate projects. The demise of LUNA has undoubtedly set the entire industry back, but the good news is that innovation and learning will continue.

Paradigm Co-founder Matt Huang:

Every generation will relearn the lessons of leverage, whether explicit or implicit. (The generational time frame in the crypto industry is 2-3 years)

EthHub Co-founder Eric Conner:

I really can’t understand how any fund in this space didn’t see the collapse of Luna coming. It was so obvious. Basically as obvious as Bitconnect. Are people that stupid or just blinded by greed?

Industry KOL Cobie:

I believe ETH and BTC will reach all-time highs in the future. I don’t know how long it will take, but I believe it will happen. However, the same cannot be said for anything else; many of them could drop another 95%, and their valuations are still absurdly high. Preserve firepower as much as possible. Maybe a few months, years, or a decade of hardship… who knows, certainly not me. Get out of your mental "peak net worth" and make a plan for the future. If you don’t bet, you can’t win, and if you lose all your dollars, then you can’t bet. Stay safe.