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BTC is not pegged, that's the diff. When you don't claim a value, you don't need a 'backstop.'
by thedudeabides5 4y ago
BTC is not pegged, that's the diff.
When you don't claim a value, you don't need a 'backstop.'
- NovemberWhiskey 4y agoThere were two pieces of this particular crypto asset framework. The first part was Luna, which was a generic coin with no pegging mechanism or backing assets. The second part was Terra, which was a USD-pegged stable coin. The novelty was a guaranteed mint/burn mechanism across the two which was intended to maintain the peg on Terra. As the prior poster correctly asserts, Luna was never pegged.
- snovv_crash 4y agoYou always need a backstop, otherwise you only have scarcity and not intrinsic value. Scarcity gives value in a bull market when people want in, but only a backstop gives real intrinsic value in a bear market when people want out. It isn't like you can reverse the mining process and get back the electricity which was used to mint your BTC or something.