LUNC/USTC roadmap after validator delegation restored

Twitter handle: @jofo_real
I have written many pieces on Terra in the past and have been closely following developments in Terra for around 7 months

Assuming validator delegation is restored, the community needs to unite around a common purpose and roadmap for USTC. Here are my suggestions.

1. Decide on a path for the algostable

  • crypto ecosystem needs an algostable that’s 65-90% exogenously collateralized (eg, FRAX model but with BTC instead of USDC)
  • Kwon was right that a decentralized economy needs decentralized money
  • money is all about network effects / market share over time
  • overcollateralized algostables like DAI need >$1 of assets for every $1 of DAI minted, so they must grow at less than the rate of crypto economy growth. However, on the other side, they are very safe
  • DAI is an outstanding product for what it is, but we shouldn’t try to compete with it

2. Assuming we decide to revive the algostable, immediately build a reserve

  • before its death, LUNA was 20% exogenously collateralized (mostly BTC)
  • 70% would be a more reasonable reserve target
  • this needs to be done immediately & maintained, can’t be something “we’ll get around to in the future”
  • as we saw with Kwon, hubris is a powerful drug, we can’t trust individuals or “Multisigs” with that level of power again
  • the reserve needs to be decentralized immediately - smart contract-based deployment, 100% on-chain; rule should basically be “for every 1% that USTC trades off-peg, deploy 1% of exogenous collateral defending the peg”

3. As a protocol, focus on real world asset integrations & real world demand

  • USTC is the only non-ETH stablecoin, and has by far the largest number of active wallets of any decentralized stablecoin - that’s a key pair of competitive advantages
  • an algostable that’s endogenously collateralized will only survive as long as its real world adoption (transactions or borrowing) is proportional to its endogenous collateralization
  • therefore, the Anchor approach was a total blunder, creating billions of idle deposits ready to flee at any sign of trouble
  • currency backing real world loans or used in everyday transactions, by contrast, doesn’t have such fickle loyalty. However, it takes much more annoying KYC integrations
  • I work IRL for one such “crypto to real world asset / RWA” firm and if the community desires, I’d volunteer my company’s part-time assistance in this regard. It is a very tough set of technical problems esp. in the current market environment but it’s the only way

4. Understand that in owning a LUNC that’s viable, you own a hand-grenade financial product

  • algostables, as we’ve learned the hard way, are very hard, even more so when they are “undercollateralized” (partly collateralized by a reflexive endogenous asset)
  • there are many new members of the community who will hold the fate of this in their hands
  • for those newer members … be very careful on governance issues. Don’t trust anyone who sounds one bit arrogant, cocky, etc. Don’t ever centralize authority in any “NewCo.” Ever


You disagree with 95% of the suggestions…

1 Like
  1. List item



我跟你同意. I hate DK too, I just don’t think all his ideas were bad.


ORION MONEY,也许像他声称的是LUNC死亡螺旋的受害者,ORION MONEY声称将逐步退出LUNC项目。但是ORION MONEY应该关注一下LUNC社区强大的生命力,关注下社区庞大的用户群体和他们的狂热程度,重新权衡退出Luna2.0,回到LUNC。
作为Luna1.0最大的验证者,正如它所言这在我们的支持下做到的。所以希望ORION MONEY继续支持社区并投票给提案4095,我们能看见是谁投票,包括前两个提案我们都记得有ORION MONEY的支持。
相信今后我们必将会继续支持你,只要我们知道ORION MONEY和我们在一起。所以ORION MONEY请投票4095,让我们这些没有离开LUNC的持有者获得原本就属于我们的治理权参与今后的治理!
请包括ORION MONEY在内的所有验证者,为社区的未来投票!