How to lose 3 Billion dollars buying Luna

In this issue, we go over how Luna Foundational Guard lost $3 billion. We also talk about Lens Protocol, the last social handle you'll ever need!

How to lose 3 Billion dollars buying Luna
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gm friends, a lot has happened in Web3. Here's some things that just minted👇

  • Breaking down Luna's $3B Bitcoin loss
  • The last social media handle you'll ever need
  • Coinbase releases new features

Breaking down Luna's $3 Billion Bitcoin Loss 📉

$LUNA has gone straight to 0 and Terra is trying to recover UST in any way possible. If you want a recap of what happened, check out our last issue here.

But what happened to the $3 billion worth of assets kept by the Luna Foundation Guard? Here's how the LFG lost 80k Bitcoin in a little over a week:

  • May 7, 2022: The LFG started with 80,394 $BTC worth ~2.85 billion
  • May 8, 2022: $UST began to depeg. The Luna Foundation swaps  52,189 $BTC for 1.5 billion worth of UST.
  • May 10, 2022: $UST drops blow $.75 and LFG executes a last-ditch effort trading 33,206 $BTC for 1.1 billion UST.
  • May 12, 2022: LFG swapped 883 million UST for 221 million LUNA to protect against a governance attack against validators

What does this mean? Well, to try to defend UST and protect LUNA, LFG basically dumped the nearly 3 billion in Bitcoin they held for a combination of UST and LUNA. UST is worth 10 cents now and is quite possibly heading to zero, while LUNA is already there.

In other words, this is how LFG lost $3 billion worth of Bitcoin in 6 days.

📲 Lens Protocol - The Last Social Handle You'll Need!

We've all heard of the social influencer problem. Instagram, TikTok, Youtube, and Twitter are all competing against each other. The problem? The audience, algorithm, and basically everything about one platform is different than the other.

As creators, we are stuck. Reliant on one platform as the other may not be relevant. This is life in Web2.

But we're not in Web2 anymore! Introducing Lens Protocol, a Web3 open social graph. Okay, what the hell is an "open social graph". Let's think back on how we create social media accounts in Web2. We first pick a platform such as Instagram and then create an account. Account -> Platform.

With Lens, the centerpiece of the protocol is your NFT profile. The first thing we do is create a profile, and then we start to select different platforms and extend our social graph. The best part? Everything lives in the Polygon ecosystem, and the profile we create in the beginning can be used for every application. No more needing to "growth hack Twitter followers from 0-500 in 30 days".

User data is no longer stored in a centralized server controlled by Twitter, social algorithms are open-sourced, and you have full control over everything you do.

Coinbase Rolls Out New Features

Web3 is complicated and scary. There's a lot of complexity and an increase in responsibility, which is why Coinbase has been rolling out a few features to make this easier. Let's see what they're doing.

First, they plan on solving issues around Web3 identity by providing a free ENS address if you have a Coinbase Wallet. The catch is that you have to provide a KYC verification to Coinbase, who will then pass these onto dapps through ZK proofs (zero-knowledge proofs).

Next, they want to make the user onboarding experience easy by rolling out a wallet using MPC technique for secure private key management. Let's learn what this means in human terms.

When you buy funds from Coinbase, you don't manage your own wallet. Instead, Coinbase handles this complexity for you. If you want more control, the most common solution is to use a self-hosted wallet such as Metamask, where you are responsible for managing your own private keys and security.

The solution? Let's combine both approaches. Give Coinbase some information about your keys while you keep the other. Less responsibility falls on the user while retaining security. This is achievable through a cryptography technique known as MPC.

Still too complicated? Basically, imagine if instead of just buying crypto on Coinbase you could also directly use those assets to yield farm, buy and store NFTs, vote governance, etc without moving to a separate wallet such as Metamask.

What else minted?

If you like learning about Web3, blockchain, NFTs, and tech, subscribe to our free newsletter! We post every Monday, Wednesday, and Friday! And if you haven't yet, follow me on Twitter!

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