What's next for Luna? Bear Market Season?

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gm friends, a lot has happened this week in Web3. Here's some things that just minted👇

• The downfall of Luna & revival plans
• Bear market is here
• Otherside preview
• Coinbase isn't safe

What's next for $LUNA? 📉

What a week after the crazy cash of UST and Luna. For those new, let's recap how the Terra ecosystem works.

UST is an algorithmic stablecoin that is pegged to the US Dollar ( 1 UST = $1). Luna, on the other hand, was designed to maintain the price of UST by reducing market volatility through arbitrage. Traders profit by exploiting price differences between Luna and UST, which were considered identical assets. If the price of UST ever went over a dollar, a LUNA holder could burn (remove a LUNA token) to mint (create) additional UST tokens. This mechanism is what led to over 6 billion LUNA being minted in the last week and causing the price to crash from $65 USD to $0.0002 USD in about 8 days.

So what caused UST to crash? A mix of an attack draining the pool liquidity and the community panicking from this. During the initial de-peg, Luna Foundational Guard started selling Bitcoin to defend the peg and the attacker took full advantage of it. You can read more about the attack below:

So how did LFG respond? There have been two main proposals:

• Revival Plan from Do Kwon. This would "fork the chain", or create a copy, and restart from the day before the attack. 1 Billion tokens would be distributed to both Luna holders and UST holders before and after the attack. 10% would go to a community fund, but the priority would be to make UST holders whole as much as possible.
• Tiered Repayment from FatMan. Snapshots would be taken of all UST and aUST holders prior to the depeg and give something along the lines of FDIC insurance. Considering that the top 100 Anchor wallets own 92% of all UST, the $1.5 Billion in the Terra fund can easily recover a vast majority of small wallets while giving back a portion of losses to the top wallets.

What to do in a Bear Market? 🧵👇

It's been a LONG week in crypto. Everything is down nearly 80% from all-time highs, LUNA crashed to a legit zero, and UST's depeg has everyone questioning the legitimacy of crypto. So what do you do?

Survive.

Emotions are high, net worth is possibly at a low, and the market is at one of its most unpredictable states. No one explains this better than Punk6529.

Coinbase isn't safe

Amidst the madness of both the stock market, crypto market, and NFT market was Coinbase announcing poor earnings, a drop in monthly users, and most shockingly, how user assets could be used in bankruptcy proceedings.

Why does this happen? Well, when we trade NFTs or swap crypto on DEXs, we generally sign transactions using a self-hosted wallet like Metamask. When buying crypto on Coinbase, this complexity is abstracted from the user, and Coinbase hosts the user's wallet for them. Unfortunately, this means the control and access of the funds are to Coinbase.

So what can we do? One solution would be to transfer funds to a self-hosted wallet such as Metamask. This would provide a private key that you can use to prove you own the assets associated with the public key. If you want to learn how to set this up, we have an excellent guide right here.

The Otherside Preview

Yuga Lab's Otherside project has unveiled a preview of their gameplay this weekend. My thoughts? Very promising. The graphics look smooth and feel like a AAA gaming studio such as Epic Games or Riot created it. This gives quite the weight off people's shoulders, especially since many rumored that the game mechanics and design could take months from the original mint.

The demo features a text and voice chat, jumping mechanics that remind me of Apex Legends, and exploring a world in a very Breath of the Wild/Elden Ring manner.

Take a look at the demo below:

📰 Other things that just minted in Web3 👇

• Adidas Originals Ready Player Me avatars are ready and available to claim
• UK proposes regulations that would recognize stablecoins as a form of payment
• Roblox is embracing Web3 and potential NFT integration
• Vitalik Buterin co-authored a paper on NFTs titled Decentralized Society: Finding Web3's Soul
• Kevin Lin, co-founder of Twitch, just raised $24 million for his Web3 gaming company Metatheory
• Chainsmokers next album "So Far So Good" will launch on Royal to distribute streaming royalties to fans
• Emirates Airline is looking to add Bitcoin as a payment method

NFT Project Updates

• Cool Cats 2022 roadmap thread announced! Featuring Coolverse, a 3D multiplayer world to immerse yourself in Cooltopia.
• Doodles announced a free claim for holders Dooplicator
• ApeCoin has two new proposals. The first is a $2 million budget for a curated NFT platform which is heavily voted against. The second is a vote to have Guy Oseary a representative of Apecoin in partnerships and initiatives which is heavily favored. Voting closes May 18
• RagnorakMeta art was revealed this past week and was criticized for having art similar to Azuki's
• The makers of Robot Chicken (Stoopid Buddy Stoodios) set up a proposal for a Nouns DAO documentary  which goes through the journey of how Nouns made its way to the Rose Parade.
• Invisible Friends announces partnership with lifestyle-brand Kith to bring digital and physical partnerships

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!