For questions to the Proposal:
$LUNA and $UST crashed before this Proposal is implemented.
This Proposal has not taken effect at this moment, and have no direct bearing to $LUNA and $UST’s collapse.
What we all have observed is how the market works.
The market will find equilibrium, one way or another.
Above said, the low Mint/Burn throughput is one of the key contribution factor to $LUNA and $UST’s death spiral (in addition to the protocol design itself).
If there are enough Mint/Burn throughput, a lot more $UST could have been burned during the early hours of $UST de-peg, while $LUNA is still trading at higher price. This would generate much less dilution of $LUNA.
If we look at the first $UST de-peg period, $LUNA is trading around $30-$40, then stabilizing at around $30. During the same period, $UST continue to remain de-pegged, stabilizing at $0.95
During this period, more than $8B $UST has been withdrawn from Anchor Protocol, but less than $1B $UST has been burned.
The reason for so few $UST burned is because the Mint/Burn capacity limit.
These over hanging $UST will need to be burned. This is just how the market works.
Unfortunately, the $UST burning speed never caught up with the speed of withdrawal, and leaving a lot of over hanging $UST in the market.
When billions more $UST gets burned at later time, they were burned at much worse $LUNA price, resulting in much worse and significant dilution to $LUNA. Then the spiral.
Unfortunately, the effort to save $UST and $LUNA is too late.
This is indeed a very sad outcome.