Can anyone explain how comes Luna/UST failed at being an algorithmic stablecoin while DAI exists since 2017 and managed to hold its peg through crazy turmoil (like the price of ETH crashing from 1400 to 80 and then skyrocket to 4000)?
Why isn't the same "attack" happening on DAI, which is a big target ($6 bn of DAI worth $1 each, with $10 bn collateralized)?
Maybe because Dai is collateralized with Ether, which is a much thicker market than Luna/Terra/UST, because you can use Ether for things that aren't Dai?
Well, that and Luna is only worth money if Terra is stable, and Terra is stable if Luna is worth money. I don't think Dai is susceptible to the same sort of death spiral.
Right, Ether is still worth money even if Dai implodes, even if maybe a little less so, for reasons that aren't strictly about how thickly capitalized the Ether market is.
There were like $18bn Terra. It was "backed" by maybe $3.5bn of BTC, and by minting Luna from scratch and hoping people would assign a nonzero value to the Luna token.
Why isn't the same "attack" happening on DAI, which is a big target ($6 bn of DAI worth $1 each, with $10 bn collateralized)?