The Collapse of Terra Classic Network Resulting in a $40 Billion Loss

Summary # The Terra Classic Network, worth $40 billion, collapsed due to a mix of market factors and significant events. The network hinged on its two primary coins, $LUNC and $USTC. $USTC, an algorithmic Stablecoin, was designed to hold a steady value of $1. $LUNC was created to soak up $USTC’s instability through minting and burning processes and built-in opportunities for arbitrage. Trouble began when the Luna Foundation Guard withdrew a large portion of $USTC from Curve3pool to make room for the new Curve4pool. ...