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Doesn't that make UST a derivative of LUNA? The price of UST when it is below $1 should be equal to the expected percentage that LUNA falls during the time it t

Doesn't that make UST a derivative of LUNA? The price of UST when it is below $1 should be equal to the expected percentage that LUNA falls during the time it takes to convert your UST to LUNA and then sell that LUNA. Since doing that actually inflates the LUNA supply there is no point at which LUNA should stop falling (absent other value propositions) and therefore UST should always be below $1 and so LUNA should inflate away. I'm probably missing something, but stable this is not.

influxmoment 4y ago
- CryptoPunk 4y ago
  There is nothing inherently scammy in using a distributed blockchain to record balances, and cryptography to authenticate updates to the balances. While opening the door to financial contracts to every one in the world with a computing device may make scam offerings more common, it's overly simplistic and lazy to resort to a caricature of crypto tokens being, as a rule, scams. The vast majority of crypto projects in top 100 by market cap are not like UST/LUNA. The demand for them comes from speculation about future utility, but there is no unsustainable market-beating yield to entice people to deposit new money.
  - influxmoment 4y ago
    Copying a project that was supposed to have limited tokens and then making your own private money and selling it is inherently scammy. And then avoiding security laws and responsibilities for your personal project by claiming decentralision
    - CryptoPunk 4y ago
      I was not referring to this particular project. You implied all crypto projects are scammy. I was taking issue with the over-generalization. And as an aside, not being in compliance with SEC regulation does not in any way make a project scammy. Being non-compliant with SEC regulations could be the case with LUNA, and still be entirely incidental to it being scammy, as it is possible to operate with no deception and without exploiting any one - which is an essential component of any scam - and still run afoul many SEC regulations.
      - influxmoment 4y ago
        I was referred to all crypto projects in that they avoid responsibilities and just laws by telling a myth of decentralization
        CryptoPunk 4y ago
noodles_nomore 4y ago
Too late to edit: I guess what I'm missing / got wrong is that this represents only a price floor for UST.
proto-n 4y ago
You are not missing anything. It's has a death spiral in it by design. If luna price goes down, then people lose trust, then people start selling ust, which leads to burning ust and minting more luna, which inflates luna supply, which makes luna price go down, which makes people lose trust more, etc. And it gets faster and faster as luna price falls, because more luna is minted to burn the ust. The amount of minting is inversely proportional to luna price.

influxmoment 4y ago

CryptoPunk 4y ago
There is nothing inherently scammy in using a distributed blockchain to record balances, and cryptography to authenticate updates to the balances. While opening the door to financial contracts to every one in the world with a computing device may make scam offerings more common, it's overly simplistic and lazy to resort to a caricature of crypto tokens being, as a rule, scams. The vast majority of crypto projects in top 100 by market cap are not like UST/LUNA. The demand for them comes from speculation about future utility, but there is no unsustainable market-beating yield to entice people to deposit new money.
- influxmoment 4y ago
  Copying a project that was supposed to have limited tokens and then making your own private money and selling it is inherently scammy. And then avoiding security laws and responsibilities for your personal project by claiming decentralision
  - CryptoPunk 4y ago
    I was not referring to this particular project. You implied all crypto projects are scammy. I was taking issue with the over-generalization. And as an aside, not being in compliance with SEC regulation does not in any way make a project scammy. Being non-compliant with SEC regulations could be the case with LUNA, and still be entirely incidental to it being scammy, as it is possible to operate with no deception and without exploiting any one - which is an essential component of any scam - and still run afoul many SEC regulations.
    - influxmoment 4y ago
      I was referred to all crypto projects in that they avoid responsibilities and just laws by telling a myth of decentralization
      - CryptoPunk 4y ago

noodles_nomore 4y ago

Too late to edit: I guess what I'm missing / got wrong is that this represents only a price floor for UST.

proto-n 4y ago

You are not missing anything. It's has a death spiral in it by design. If luna price goes down, then people lose trust, then people start selling ust, which leads to burning ust and minting more luna, which inflates luna supply, which makes luna price go down, which makes people lose trust more, etc. And it gets faster and faster as luna price falls, because more luna is minted to burn the ust. The amount of minting is inversely proportional to luna price.