The spectacular implosion of the Terra ecosystem in mid-May left the crypto industry scarred. Though there were some brave critics who understood just how thin the razor’s edge was for TerraUSD (UST) — now TerraUSD Classic (USTC) — I think it’s safe to say that most people didn’t expect Terra to fail so fast, so dramatically and so completely irrevocably.
I’m writing this as the Terra community is voting on a plan to restart some kind of Terra 2.0 — a plan to salvage the layer-1 ecosystem without the UST stablecoin. The old Terra, now to be known as Terra Classic, is completely dead. An ill-fated attempt to backstop UST holders printed trillions of LUNA tokens, destroying their value and ultimately jeopardizing the safety of the network itself.
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