Are we witnessing a Terra Luna Wonderland death spiral? As you’re all aware Wonderland has absolutely suffered a severe implosion. It’s time to pour one out for everyone who invested into Wonderland. You’re gonna need to buy a few rounds. What happens to Luna as the dominoes continue to fall?
How Much Are Wonderland Investors Down?
From its peak less than 3 months ago (+$9600) $TIME is now $394 at the time of this writing. That’s a 96% drop for those of you scoring at home. $WMEMO has dropped 78% of its value over two weeks. Not even an 87,000% APY is gonna bring that shit back. The token named “Wonderful Memories,” is bringing anything but that to the true believers of Frog Nation and everyone who put money into the project.
Full Disclosure: I put some money into Wonderland. A small percentage of my crypto bankroll is reserved for some plays with a downright anorexic chance of making me enough to leave my full time job. Honestly, I’m not even mad. I went into this knowing full well that it could fall to zero. In times like these, we would do well to remember the wise words of Omar from The Wire.
How Did Wonderland Fall So Far?
Time had been losing value steadily since early November. The slide in the broader crypto market didn’t help, but Not only have hundreds of thousands of investors lost money, they witnessed an outrageous drama play out in real time on Twitter. BowTied Pickle gives a thorough, detailed explanation right here. Ugly questions are being asked about how founder Daniele Sesta made critical “mistakes” that a shift manager at Dunkin Donuts wouldn’t fall for. Namely, bringing on an ex-convict who was anon 0xSifu and installing him as Chief Financial Officer of Wonderland. As if that wasn’t awful enough, the crime that Michael Patryn, hold up a sec, Omar Dhanani, was convicted for and was sentenced to 18 years of fed time for was… credit card fraud!
And just when you thought this shit hit bedrock and couldn’t get any more fucked, Sesta admitted that he had known about
Sifu Patryn Dhanani and his shady af resume and still allowed him to hold the keys to the kingdom!!!
Side note: “I want everyone to know that I was aware of this and decided that the past of an individual doesn’t determine their future. I choose to value the time we spent together…” This sounds like what a guy with a reformed stripper girlfriend would say after a video leaked of her getting plowed by the local JUCO football team.
Okay, So What Does This Have To Do With Terra Luna?
Terra Luna has dropped hard in the wake of the Wonderland apocalypse. Many investors who are wary of the Wonderland Terra Luna connections have moved their money. As of the time I write this Luna is down 23% on the week. Can’t blame the market for it’s down week, only one other crypto (Kusama) has lost more than 9% over the past seven days. TL reached triple digits on Christmas. It now trades for less than half of that. The chaos of Sesta’s
poor shitty indefensible decisions spilled out of the rabbit hole and made its way to the markets to wreak havoc.
How Does Wonderland Tie In With Terra Luna?
Investors are scared that Wonderland’s collapse will cause UST (the stablecoin of the Terra Luna ecosystem) to lose its peg. It is designed to hold a value of $1.00 USD. This is accomplished by burning UST or LUNA. UST was used for loans against MIM (Magic Internet Money, a USD stablecoin that backs TIME).
This also sent Anchor Protocol, the DeFi Savings protocol on Terra Luna into a tailspin. Wonderland threw off the equilibrium AP needs between borrowers and depositors. Anchor has has lost $1.7 billion, 20% of its TVL (Total Value Locked) over the last seven days. You can read this post on Crypto Banter for a detailed explanation. However, UST still seems to be holding up very well to its pegged value. The bottom line, due to the amount of exposure that the Terra Luna ecosystem has to Wonderland.Money and Daniele Sesta’s inability to hire one of the billions of “unjailed” people of the world, Terra Luna and its ecosystem is flailing in the markets.
What Happens From Here?
I’m a big believer in Terra Luna. UST has held up to this challenge so far and I think the TL ecosystem has a bright future. Is there a chance the price of Terra Luna collapses further? Sure. I think the most probable scenario is that it stabilizes around here and turns around. There’s a lot of institutional money in the Luna ecosystem and I think they could pull out all the stops to make sure it doesn’t fall any further.
Disclosure: Terra Luna is my 3rd largest position and I hope to add more to my bankroll at $50 each. None of this is financial advice, please read our disclaimer.
As for Wonderland, it should be in a Chernobyl, circa 1987 state for some time if not permanently. It’s been violated, as has the trust of so many in Frog Nation. Perhaps we all, myself included shuld have looked a little further into the project past the, ahem… spellbinding APY before plunking down any capital.
Final Thoughts on the Terra Luna Wonderland Chaos
The perplexing “mistakes” by Daniele Sesta, short for Sestagalli (probably a very bad sign when both co-founders of Wonderland altered their names) mean that likely millions will steer clear of his projects moving forward, even if everything is done by the book.
What remains to be seen is if Joe Biden uses this debacle to embolden his push for regulatory measures on cryptocurrencies. Will he unleash turbo-Karen Elizabeth Warren on the crypto markets? Rumors have surfaced that Sifu was a government plant to and that Wonderland was designed to implode in order to expedite crypto regulation. The biggest domino to fall in this mess may not be the one that topples over Wonderland or Luna investors. Every cryptocurrency investor in the United States could be affected negatively and permanently by the madness in the rabbit hole.
If you’re going to place a bet on a risky venture, especially one with a giant grinning cat on the front page of its site, make sure that it is with money that you can afford to lose.
From now on SIFU should be the acronym for Daniele Sesta’s reply when asked about the Wonderland debacle… “Sorry, I Fucked Up.”
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