Here’s how Do Kwon cashed out $2.7 billion using Degenbox to drain liquidity out of the LUNA & UST system and into hard money like USDT.

Share:

Credit: https://twitter.com/FatManTerra/status/1535623662153437185

Do kwon was a paper billionaire with no way to cash out without causing a depeg. Heres how he used degenbox to cash out into usdt/usdc

Lets start with what degenbox is: a borrowing protocol where people can loop stablecoin buys. You can stake collateral to buy UST, put it into Anchor, then use your aUST to borrow more UST, put it into Anchor again… You get the drill. It’s Anchor on steroids.

Terra influencers shilled this strategy en masse, and thousands of retail users began flooding into Degenbox to access the high yields. This created incredibly thick, near-immovable liquidity near the top of the peg zone (the $0.98 to $1.00 range). In a nutshell, it would allow for someone to cash out billions of UST for MIM at a 1:1 rate without disturbing the peg – all thanks to inorganic demand.

Here’s the total amount of MIM Do Kwon was able to cash out through the MIM/UST pool – without even moving the peg! $2,719,132,772.01, to do with what he pleases. No need to dump LUNA or sell UST on exchanges – he drummed up liquidity from all of you.

https://preview.redd.it/17acssrn40591.png?width=572&format=png&auto=webp&s=79356b83aef142fd546bcf33972658175e3050f1

UST is the future, he said. Decentralized money is sound money, he said. UST won’t depeg, he told you. ‘Centralized stablecoins will rug you eventually.’ So why did he cash out $2.7b from UST into USDT and USDC? Were all those words just lies? (Spoiler: yes.)

https://preview.redd.it/lnqogfqt40591.png?width=850&format=png&auto=webp&s=e93885ed51bdb66e654f912358d6ff5b98688263

Here are TFL’s outflows. $558m to KuCoin, $1.08b to Binance, $545m to Huobi – you get the gist. Ultimately, all of this money is liquidity being removed from the Terra ecosystem, exacerbating the collapse, bolstering TFL coffers – all while they lied to your face.

https://preview.redd.it/zov83ccz40591.png?width=816&format=png&auto=webp&s=12e48c26e57df86fd7db10c3277c6b6208309b0c

https://preview.redd.it/noikmgs050591.png?width=816&format=png&auto=webp&s=054257b4ccda21e26fa9bb70bdcf39662e6a951d

Again credit to https://twitter.com/FatManTerra/status/1535623662153437185 and also https://twitter.com/fozzydiablo/status/1487191909948960776

submitted by /u/Far-Scholar9028
[link] [comments]