This is probably going down as one of the most historic crashes in cryptocurrency history altcoins are entirely getting destroyed as UST collapses terror went down 98 within just one day. The cosmos ecosystem is also losing a lot of value and I will share with you what’s going on in the markets right now. What happened to UST, what is the proposal to move forward and fix the UST pack to a dollar and to fix LUNA and to fix the crypto markets in general.Also we’re gonna take a look in my 10k portfolio challenge which absolutely got destroyed.

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Now two days after the first d-pack Luna and UST collectively have lost more than 50 billion dollars in market value, in fact, if we go ahead over on CoinGecko and we look at the markets. We see blood across the board. This is absolutely insane. Avalanche just dropped 23 percent in the last hour alone 40. In the past 24 hours and cut in half in the past seven days. You can see this across the board Terra entirely lost its pack at 31.6 cents right now and if we want to see Atom went below ten dollars. If we want to see where Luna is we have to scroll down a lot. This was a top six top seven cryptocurrency just a few hours ago and it’s right now at 86 cents ranked 83 on COIN GECKO with a market cap of 650 million US dollars. Terra, Luna had extremely aggressive tokenomics. Now they’re paying a very high price for that experiment with Luna and UST with the mint and burn model. I’m not going to go into details.

This is just absolutely insane CoinGecko is not even loading at this pace. I’m sure the site is completely loaded right now, but this is where we are right now. Bitcoin itself has fallen below 30 000 which is apparently a critical support level. If we want to remain you at least bullish in some way shape or form. If we look at historic levels we see 30k has always been strong support or resistance and now. We’ve been below it a couple of times before, so if that’s just a wig and we go up again from here. It’s all fine if not we might revisit 2017-2018 levels down here at 20k and maybe even fall below that. So, let’s see how this plays out but obviously. The markets don’t look really good right now. If you have been all in they do look good, however, if you want to buy in right now and have capital on the sidelines that you want to deploy and get into crypto because you always want to buy when things are extremely fearful and are red right buy low, sell high. 

It means buy red cell green right, so now everything is bloody red. It’s a good time to get into to maybe scale into crypto maybe not as of right now. As you’re catching a falling knife but maybe it’s a good time to scale in and slowly build up positions especially in the altcoin sector because just to remind you. Besides the prices nothing has changed, in fact, the technology is getting better by the day the developers are improving the code. They’re you know improving their products refining the game theory obviously. There are a lot of lessons learned from UST in terms of how to design an algorithmic stable coin. But the technology is getting better and the prices go lower. So, it’s always irrational market behaviors when everything is extremely bullish the market tends to be extremely overpriced and when everything is extremely bearish the market massively undervalued really quickly. We have this massive sell-off of people losing their life savings, it’s not nice if you experience that right now. I’m really sorry for everybody who was overexposed to crypto and is now suffering heavy losses. 

I also tweeted about my 10k challenge portfolio which absolutely got destroyed. If you look here, we can actually take a look at the numbers in the last half an hour. This has changed again it went down even further, so this is currently an absolute fire that’s going on the markets, an absolute bloodbath. But one interesting thing that I want to do talk about real quick is that dokwan came out three hours ago and made a tweet made a thread actually about uh the situation on UST and the first measure that they had taken is discussed in this proposal where they plan to increase the minting capacity from 293 million dollars to 1.2 billion dollars. I dissected in a quick tweet what that actually means. The purpose of Forex minting capacity is to accelerate the burning of UST because right now. Everybody wants to exit UST right since it has lost a pack of people rather than preserve smaller losses. In order to prevent a total loss you can already see that if we go over here on anchor protocol itself. We can see that there were only four billion UST left two or three days ago. This number was 14 billion right out of the 18 billion that were circulating at the peak so 80-70-80 percent of all UST were on Anchor which was the predominant use case for UST because you could earn 19.5 percent actually 20.25 right now on your UST. In UST but that system collapsed now and there’s only actually 3.7 billion the rest is borrowed 3.7 billion in user deficits right.

So, what these people do they take their UST out of Anchor. They want to burn their UST to get Luna back um but this burning is going really slow because it is capped at 290 million dollars so um what is happening as uh traders and speculators see that this UST are getting dumped and getting burned. They can already anticipate that this is extremely bearish for Luna because it will mint Luna which increases their circulating supply. In most cases, these Luna will just be dumped on the open market. This will mean heavy cell pressure on Luna which is why traders are shorting out of Luna right now. They’re shorting it like crazy which is why the price dropped to 80 cents right now. This is absolutely insane. I’ve never seen anything like that 50 billion dollars being wiped out just like that. This is extremely harsh now in this proposal and in this thread, DOE also said that we have to swallow that pill there’s nothing else. We can do, but we can only increase the mini capacity to go through this to swallow this pill faster. So that the cell pressure of UST decreases, all UFC get burned. 

Then when the dust settles they will deploy fresh capital. I don’t know how much they still hold reserves. I think they still have a few hundred million in Bitcoin. I don’t know exactly but I’m sure they still have reserves and then they also have a strong network of VCS obviously that are highly interested to restore the UST pack. Then also stabilize the price of Luna at some point which probably is going to be way lower which is why my recommendation number one is. Don’t try to catch the falling Luna knife, don’t even try to catch the falling UST knife. This thing can get really ugly even uglier than it is right now. But don’t try to catch it you might suffer extreme losses here and again once this dust settles. They’re probably gonna deploy fresh capital, I don’t think they’re gonna. Let Luna and Terra and everything die like this. But it has been one of the most hyped projects to encrypt over the past few months. It went up significantly in value in market cap and 60 billion at the peak and now it just vanished basically to zero now.

What does this mean for my 10k challenge portfolio? What does this mean for the broader cosmos ecosystem because UST has been the predominant stable coin within the cosmos? It just imploded. Let’s look into my portfolio first. Here I have 1642 dollars that I have in balance here that I have staked with my Atom and Juno. You can already see the Apes are going up again Juno at 111 Atom, at 17 Cosmo 61.6 and Secret at 23 right. This is because people are unstacking and dumping because they’re panicking. I think that’s not a smart thing to do because again fundamentally. Nothing has changed, nothing got hacked. It’s just pure market emotions. But I understand if people need money and if they want to pull it out that’s all fair. However, I’m not doing this right and I also have stars that got entirely destroyed. They also have way over 100 APE. So, this is what I’m at. I’ve been compounding my rewards just not in the past two or three days. Because those were also traveling um but yeah so this is where my staking portfolio sits right now. Then I still have 200 in liquidity on Junoswap which I’ve been providing in anticipation for the raw drop and we can actually look whether or not. I got this airdrop, so we went over to rawdaw.zone.

We’re gonna click to connect our wallet and then we can see boom we got almost 1 100 raw tokens from that trading wallet alone so we can go ahead and claim these tokens. Then we can go over to the osmosis frontier and I think this is the only place as of right now, where we can see a price for raw and it currently has the value of 25 Cosmo which currently is like 40 bucks. But it is what it is at least free money why not bad. Also finally I have roughly a thousand dollars here on my Atom Juno Pool, Atom Cosmo Pool which is also superfluid staked here with stayxito. This is also pretty cool here. But this is what it is. I think roughly it’s around three thousand dollars or something down 70 absolutely wild. 

This article is a transcription of a video made by Cryptocito

Original video: https://youtu.be/iMecyoJWk4U