How much money did the LUNA Foundation lose from speculation?

Overnight Bitcoin (BTC) continued to recover from the overall collapse caused by the LUNA death shock wave a few days ago, and now continues to hold at $30,000.

There are different opinions about when the LUNA Foundation dumped its bitcoins. I saw one saying that it was between May 8th and 10th, when the price dropped from 36k to 32k. 80,000 bitcoins dumped into the market triggered a tsunami and an earthquake.

Because according to the LUNA Foundation’s own disclosure on May 16, they still held 80,394 bitcoins in reserve assets on May 7. According to on-chain monitoring, on May 10, the bitcoins in the LUNA Foundation’s on-chain address were cleared and all transferred to the exchange. Of course, it is unknown whether it was sold immediately after being transferred.

In any case, the average recycling price of its shipments should be more than 30,000.

On May 5, just before the crash, the LUNA Foundation proudly announced that they had added 37,863 bitcoins, equivalent to $1.5 billion, and held a total of 80,394 bitcoins, making it the seventh largest holder. In addition, their public statement revealed that the purchase of bitcoins was completed through Genesis Exchange and Three Arrows Capital.

37863 pies, $1.5 billion, and the average cost of adding to the position is about 39.6k.

At this time, Bitcoin has already fallen back a lot from the local rebound high of 48k on March 29th, back to around 39k. It should be said that it opened at 40k on the 5th and was soon smashed to 36k.

In fact, the Bitcoin price plunge corresponding to the LUNA death event started at 40k on May 5th and ended at 25k on May 12th.

In other words, just when the LUNA Foundation was feeling complacent and losing its vigilance, the hunter lurking in the dark pulled the trigger.

Precise. Too precise.

There is a saying that the sniper took advantage of the LUNA Foundation to remove UST liquidity from the DeFi exchange Curve and prepare for the 4th pool. However, according to a report on the 8th, the removal of UST liquidity occurred on May 7th.

In other words, the sniper may have hit the target in advance.

This is very sniping.

Because we know that it takes time for a bullet to hit the target from the muzzle at a long distance.

Let the bullets fly for a while.

For moving targets, you need to shoot ahead of time.

In short, this must be a good marksman and a skilled hunter.

As for the earlier batch of Bitcoin, it can be traced back to March 22, when LUNA's actual controller, Korean founder Do Kwon , disclosed on Twitter that the LUNA Foundation has raised $3 billion to increase Bitcoin reserves, with a long-term goal of reserving $10 billion in Bitcoin.

Of the $3 billion, $1 billion was raised from over-the-counter sales of LUNA, and $1.2 billion was obtained from the sale of UST in exchange for USDT, leaving a gap of $800 million.

Who subscribed to his $1 billion LUNA over the counter? According to a report on February 23, the LUNA Foundation (LFG) announced the completion of a $1 billion financing round, which was completed through the over-the-counter sale of LUNA, led by Jump Crypto and Three Arrows Capital, and participated by Republic Capital , GSR , Tribe Capital , DeFiance Capital , etc. It is reported that the $1 billion in financing funds will be used to establish a Bitcoin-denominated foreign exchange reserve for Terra's stablecoin UST.

80394 – 37863 = 42531 BTC. $3 billion – $800 million = $2.2 billion. $2.2 billion to buy 42531 BTC, with an average cost of 51k. This is obviously wrong. The rally from March 15th to 29th ranged from 40k to 48k. So, the LUNA Foundation definitely did not buy all the BTC, but also bought some other coins, such as Avalanche (AVA X ).

Since there are no more details, let's assume that it was bought in batches, with an average cost of 44k. In reverse, the total cost is 44k multiplied by 43531 pies, which equals 1.87 billion US dollars.

Thus, the total cost of the LUNA Foundation to hoard a total of 80,394 BTC before being forced to sell was $1.87 billion plus $1.5 billion equals $3.37 billion. The average cost was 42k.

42k cost, 32k shipped, average loss of 10k per coin. 80,000 coins, this wave of LUNA Foundation's net loss of $800 million just for coin speculation.

It just happened that the $1 billion raised from institutions was almost gone.

After selling the cakes and collecting more than $2 billion, and paying back the $1 billion invested by institutions, maybe there will be $1 billion left to compensate retail investors? There are too many retail investors, so it is a drop in the bucket.

After reviewing this, I can't help but think of Liu Jiaolian's article "Why Can't Your Investment Outperform Bitcoin?" on December 31, 2020. The second inference reads:

“Any speculative strategy or cryptocurrency trading method will not be able to outperform holding the currency in the long run.”

Because if there is a method that can steadily earn money, then in time, the person who masters this method will complete the concentration of a large number of Bitcoins. And the more concentrated Bitcoin is, the lower its value. If all of it is concentrated in the hands of one person, the value will be zero.

The LUNA Foundation's behavior of printing UST out of thin air to buy Bitcoin is just such an act of concentrating Bitcoins without any effort. This behavior is "illegal" and violates not man-made laws but natural laws, so it can also be said to be "unrighteous".

Bitcoin must either have the autoimmune, self-purifying ability to combat and liquidate this “illegal” concentration, or it must die.

If you see through this layer, then between the death of Bitcoin and the death of LUNA, the chances of betting on the death of LUNA are obviously slightly better.

This is the way of heaven.