A market intelligence firm claims that seven crypto wallets may have been involved in the detachment of the algorithmic stablecoin TerraUSD (UST) from the US dollar.
According to digital asset analytics firm Nansen, seven crypto wallets were spotted trading large amounts of UST on the automated market-making platform Curve (CRV) on May 7, just before the stablecoin and its transmitter Terra (LUNA) suffered staggering losses.
“Seven “initiator” wallets traded significant amounts of UST for other stablecoins on Curve as early as the night of May 7. These seven wallets had removed significant amounts of UST from the Anchor protocol on and before May 7 (as early as April) and linked the UST to the Ethereum blockchain via Wormhole.
Of these seven wallets, six interacted with centralized exchanges to send more UST (supposedly for sale) or, for a subset of them, to send USD (USDC) coins that had been traded from Curve’s liquidity pools.
Nansen notes that the wallets were likely exploiting price vulnerabilities between centralized and decentralized crypto exchange platforms, which could have caused the UST depeg, rather than a single hacker launching an attack to destabilize the crypto exchange. algorithmic stablecoin.
“During the depegging process, [the wallets were] likely arbitrating inefficiencies between various pricing sources (Curve, decentralized exchanges, and centralized exchanges) by buying and selling positions between centralized and decentralized markets.
As such, we refute the popular narrative of an “attacker” or “hacker” working to destabilize the UST.
Rather, the withdrawal of UST could have resulted from the investment decisions of several well-funded entities, for example to meet risk management constraints or alternatively to reduce UST allocations deposited in Anchor in the context of macroeconomic and market conditions. turbulent.
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