TERRA LUNA has dropped almost three times as much as the majors in the last two days. The risk to the UST peg is being exposed.

Full disclosure. My position includes 2% LUNA. I intend to close out my positions once it passes $100.

I've been trying to figure it out what happened over the last 24 hours through all the noise. And there has been an awful lot. I'm only minimally involved in TERRA as I don’t believe the peg works. The risk to destabilisation is much too high. It seems to convenient to be long term effective to me.

So here is what I think has happened. Happy to be corrected and include additional details as more are discovered. But why has the value for LUNA plummeted at three times the rate of the other big coins. Near as I can tell...

Do Klown (DK) continued the stablecoin backing strategy by purchasing a stack more BTC. Either a major UST whale, or multiple smaller UST whales didn't like this and started closing their positions. Large withdrawals started on Anchor and left only $300m left in the liquidity pool before the BTC reserves will have to be used. And with BTC price dropping due the FED FUD, this increased selling pressure.

This started a cascade against UST. Investors became concerned at the prospects of a UST depeg and this tanekd the price of the paired token LUNA. Many started swapping their UST for other stablecoins which further dropped LUNA price. Then Binance announced no fees on trades between stables which just increased fears that UST would soon depeg.

TLDR: Whale(s) sold UST, low volume over weekends, BTC reserve purchase with falling price, investors scared of depeg, swapped to other stables, Binance announced temporary removal of fees swapping stables.