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A comment on Tether starting to lose its peg too, after Terra did. Parent comment

Re:Tether starting to lose its peg too, after Terra did by benjaminwootton on Thursday May 12, 2022 @05:06AM (#31351157)
I still don’t follow why the second currency is required?

They will always swap a UST for $1 of LUNA so a UST is implicitly worth $1.

LUNA itself doesn’t have anything behind it though apart from concidence. So we have a stablecoin manufactured from a volatile unbacked asset where the market cap can fall arbitrarily low.

I know it failed, but it’s not quite clicking for me what they were even trying?

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Re:Tether starting to lose its peg too, after Terra did by pjc50 on Thursday May 12, 2022 @06:06AM (#31351641)
The second currency is required for the same reason that three card monte requires three cards.
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Re:Tether starting to lose its peg too, after Terra did by usednet on Thursday May 12, 2022 @05:15AM (#31351218)
Ponzis can be very profitable. I think algorithmic stablecoins are stupid too.
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