We are willing to forgive some but not reset back and not arbitrary sizes proposed purely by LUNA holders. For arbitrary you can recover it from TFL for a broken system.
Everyone knew what the algorithm does, but the repeg didn’t work right even after dilution. There could be a lag between market forces reacting to the dilution and since the price oracle checks once a minute it could not have reacted very quickly to these changes. Let’s not speculate. The TFL team has the responsibility and action item to perform the analysis and provide everyone the results. Otherwise if nothing looks good then UST holders will want to dilute the rest of the LUNA to recover any remaining value as per the algorithm as a contract.
We can work out different terms however, for example put everyone on the UST side into higher interest bearing securities so that in time UST can be recovered. As long as everything pegs to a reserve it may work to avoid further dilutions. What has already been diluted should not be undone without UST holder accepting that.