Correct, they will have to get the money from somewhere. Do Kwon said he’s working on sources, but it will likely have to come from selling LUNA. TFL has already chosen to protect UST over LUNA. UST holders and LUNA holders had differing expectations and risk profiles when going into the respective projects. This entire situation really sucks for LUNA holders, I’ll admit, and there will likely be no recourse for them.
“Forcing” UST holders, who came along for the ride specifically for an algorithmic stablecoin pegged to the dollar, into LUNA, a highly volatile token, is not in good taste IMO.
There are stakeholders we need to balance and admittedly everyone will not be happy. Plus, this proposal ultimately has to fly with TFL, and they have chosen to protect UST over LUNA, so anything we suggest has to be in line with their motivations. LUNA is pretty much done.
In the long (long, long, long…) term, LUNA might come back if this plan goes through successfully and people regain faith in the team. For now, shoehorning it in isn’t the best plan.