🥛 Luna: The Biggest Winners and Losers
GM. This is the Milk Road – we give you all the crypto news you want and need.
Shaan’s back from Hawaii and Ben spent all weekend binge-watching the new season of Atlanta, so let’s get right into it:
Estimated read time: 2 minutes and 57 seconds
🧐 The winners and losers of Terra
📈 Chart of the Day
🤣 Meme of the Day
WINNERS & LOSERS OF THE TERRA DOWNFALL
We’ve covered what happened (here) and how it happened (here) in the Great Depegging of 2022, aka the fall of the Luna empire.
Now it’s time for a game called Winners & Losers.
Let’s start with the Winners.
3rd Place: Janet Yellen & the Regulators
Stablecoins are the biggest threat to the dollar because they are what crypto people use for transactions
UST collapse is a great excuse for increased regulation. She already said so, and so did the UK
2nd Place: Freddie Raynolds
In November, he explained exactly how someone could attack Luna
Do Kwon's response? The idea is retarded
Well turns out ol Freddie was right and got the last laugh. One of the top 5 feelings ever
1st Place: Everyone shorting /betting against Terra
The guy who made the $10M bet Terra would fail. He won the bet, and actually hedged his downside and it cost him only $0.72 to hedge his $10M bet (we covered the bet here)
The group who did the ‘attack’ (I put quotes, because not everyone agrees it was an attack) is rumored to have pocketed $900M+
Plus, a future book deal or Kevin Spacey movie is definitely coming
Losers: I got 5 for you.
The Milk Road Public Wallet
Had $200k of Luna. Last month that was worth ~$600k. Now it’s worth the same as the lint in your pocket
We lost $200k. I repeat, we lost $200k.
Had to answer “hope you’re OK” texts like we have a lump on our prostate. Of course we’re OK!! This is big boy investing. We all take Ls at some point
The Retail Investor
Got rekt
All the VCs who invested
Big names, Jump crypto, Polychain, Tribe, Binance, Coinbase Ventures etc..
Especially Mike Novogratz who got a tattoo on his arm (maximum regret).
Milk Road Rule #46, never get a tattoo of a girlfriend or token. They’ll both leave you cold, alone, and penniless.
I’m officially a Lunatic!!! Thanks @stablekwon And thank you my friends at Smith Street Tattoos. https://t.co/2wfc00loDs
— Mike Novogratz (@novogratz)
Jan 5, 2022
Do Kwon
The bigger Luna got, the cockier he became, shitting on non-believers on twitter
Now he’s hearing it back, 10 fold
Got publicly rekt
Lost the personal $10M bet too
Named his daughter Luna. In all seriousness, that may not end well. Imagine naming your son Enron if you were the CEO of Enron
Other crypto projects:
UST was “too big to fail” but failed. There will undoubtedly be impact on other projects because of this.
The market cap was as high as $41 Billion. And it went to 0 in one day. Unlike Lehman Brothers, there’s no bailout coming.
They had bought ~$3-4 B of bitcoin and have less than $10M now. That’s a lot of sell pressure that they provided to drive the Bitcoin price down
Gives defi a bad name to regulators and normies
Reinforces the meme that crypto is “too risky” and is a “house of cards.” Just because one thing went bad, doesn’t mean it will all be bad. Just like in the dot com crash, some companies went belly up, but even Amazon share price went all the way down to $5 because it got lumped in. Guilty by association.
So, what happens next with Terra? The community is currently voting on a few proposals.
Here are the top two proposals:
The Revival Plan – proposed by the original Terra founders
They want to “fork the chain” and create Terra 2.0 based on the day before the attack (basically, a do-over). They would print 1B new tokens and give them out to holders based on what they had before the chain died. Many are skeptical, because you can’t print your way out of bankruptcy.
The FatMan Proposal – proposed by a guy named FatMan
He basically wants to make all the small wallets 100% whole.
This is like FDIC insurance at a traditional bank. The government insures you up to $250K for your deposits. He wants to take whatever is left of the Luna Foundation Reserves.
This might sound like a good idea, but there’s one problem: there’s only ~$10M worth of BTC left in the reserves… They sold the other $3B+ last week in their attempt to save the peg.
The community is discussing and voting between these and similar proposals as we speak and you know we'll update you when something passes.
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CHART OF THE DAY:
The amount of venture money coming into crypto startups isn’t slowing down…yet. There was a total of $9.2B invested in Q1, a new all-time high.
The size of the checks is also growing. There were a total of 28 rounds of $100M+ in Q1 – up 65% from last quarter.
13 of these were $200M+…talk about a strong start to the year.
MEME OF THE DAY
Shaan aka “Elon’s chocolate milk” & Ben "2% Milk" Levy
See ya tomorrow!
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DISCLAIMER:
None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.
