Although it is an unfortunately needed solution, I disagree with the implementation. Yes, TFL takes all the risk, but the funds should be deposited in tranches based on milestones rather than all at once. Ideally, TFL should not be the peg holding the entire Terra chain together every time there’s risk involved, throwing money at users isn’t sustainable.
With the current wider crypto market, guaranteeing 20% yield with such a large reserve is an open invitation for too much USD to be deposited into Anchor. Meanwhile, the issue that the yield is unsustainable is not yet resolved.
It’s good that we’re getting a timeline of upgrades to Anchor and (finally) a timespan for bETH support. Each of those may or may not help achieve a sustainable peg again, but the key issue is that there’s no timeline, even just a rough gauge, of when those might be implemented. I’m probably not alone in thinking from launch that there would be support for 3 or more collateral types by now, and that development would be a lot quicker.
Promising such a large sum upfront is like Ethereum developers constantly pushing back the difficulty bomb - there’s no sense of urgency to solve the issue.