![Screenshot_20220517065532_Brave.jpg](https://i.imgur.com/VsrMQ90.jpg)

# To those living on Mars - What happened to Terra

Terra was very fast evaluated by Billions and was targeted by a short attack.

The UST - terra usd pegged was suppose to hold by the following mechanism - price drop causes Luna minting to be sold and use the money to by UST.

Also there was (maybe) a Bitcoin fund that was used (maybe) to stabilize UST.

# The Attack

Taking advantage of Bitcoin price drop in a falling market, the attackers shorted the UST. The Bitcoin stabilizing fund of the Terra foundation was weak and the minting of Luna began, deluting the Billions of Luna holders. The price of Luna kept plunging until the foundation admited they cant support the UST. Main losers are Terra investors both in Luna and UST.

# HBD resemblance and differences from UST

HBD has a fund of Hive. In case of Hive drops the HBD will plunge. This is a risk of falling market same as Terra had.

The difference is that HBD can be converted to Hive by 1$ value of Hive avarage price in 3.5 days.

This mechanism is better than Terra but the attack vector is the rate provider,if the rate provider has a bug or even market manipulation on Hive price can affect the conversion price and cause demage to converters locked in 3.5 days.

Maybe a conversion cancel mechanism is needed.


From Terra we can learn that growing to fast is risky since you are a worth target.

I think the main difference is the usability. With Luna you can only govern but with Hive and its tokens you have community influence and power of content reach.

This is why I think Hive can come out from price manipulation attacks even stronger and more famous.

But we do have to embrace the slow steady growth and know that billions evaluation can back fire if the platform and community are not yet ready.

# Should I Buy Terra Luna Or UST ?

That is a speculative question. I admit I bought some in low prices but even then earased my money. I think the project is not trusted anymore by investors and for a good reason. Maybe the price will jump but I decided not to invest after conviced the community leaders ran for themselves and left the terra investors to lose.

Posted Using [LeoFinance <sup>Beta</sup>](https://leofinance.io/@amirl/what-can-hive-learn-from-the-terra-luna-fiasco)