Direct from the desk of Dane Williams.
As a bastion of decentralisation, shouldn’t the Hive community be more critical of Terra (LUNA)’s centralisation?
Why is the Hive community celebrating UST’s $1 billion BTC reserve?
From an ideological standpoint, we should be at polar opposites right now.
I was under the impression that Hive was a bastion of decentralisation?
But just like the success of an entirely centralised Solana, we see that people don’t really give a fuck about idealogy.
All they care about is that the product or dApp built on top of the network, works better than the alternative.
Not to mention that THEIR number goes up.
While I can understand why the mainstream crypto media might champion this viewpoint, I certainly find the blind waving of corporate Terra’s flag here on Hive, somewhat baffling.
Questions around UST’s $1 billion BTC reserve
The more answers I find to the questions around UST’s $1 billion BTC reserve, the bigger my ick gets.
Just taking a step back again, we now know the BTC was paid for in an over the counter (OTC) sale of LUNA to VC’s, by Terra’s Luna Foundation Guard (LFG).
But don’t let the word foundation fool you.
LFG is essentially a shield built to legally allow the Terraform Labs company to make decisions on the direction of the network.
So by selling pooled LUNA at what knows what price, the VCs that benefited were Jump Crypto and Three Arrows.
Happy days for them!
Are these happy days for the rest of us however?
Well, who the fuck knows.
We have no idea about the details behind the raise such as whether the funds were raised directly in Bitcoin, or what happens to the money when the VC firms want out again?
All we have to go on is the following from an LFG branded press release:
The $1 billion from the sale will initially capitalize the UST Forex Reserve, with buyers locking up the purchased LUNA over a 4-year vesting period. More details of the Reserve’s function and design will be released in the coming weeks.
So literally nothing but corporate speak.
More details will be released in the coming weeks…
Umm okay…
How is this perceived as FANTASTIC for the supposed premier algorithmic stablecoin, in UST?
Let alone the fact that UST is at the mercy of VC capital, we still don’t even know how this centralised entity is going to use the $1 billion BTC reserve in times of market volatility.
All we can assume is that it will be a completely discretionary decision, made by someone sitting behind a keyboard and pressing a button.
Someone with a vested, monetary interest in the reserve first and UST second.
Decentralised?
Algorithmic?
Who knows anymore.
Final thoughts on Terra (LUNA)’s position
The more time passes, the more I feel frustrated by the fact that Terra is just another blockchain governed by a corporate entity, at the mercy of VC money.
My comparison would be that they're still just like the Steem blockchain when we trusted Steemit Inc.
Keyword being trusted.
And how did that work out for us, fam?
For me, there will always be questions as long as Do Kwon and Terraform Labs remain in the driver’s seat.
The fact that they’re now fueling the Terra (LUNA) engine with VC money is just yet another reason to drift away.
For now at least, Terra’s LUNA and UST frustratingly remain even our Hive community’s darling.
But judgement day for all of these VC-backed, corporate owned projects will come.
When I assure you that all roads will lead to Hive.
Best of probabilities to you.