Digital asset insight firm nansenannounced that on May 7, just before the collapse of the TerraUSD (UST) algorithmic stablecoin and native token LUNA, it has identified seven crypto wallets exchanging large amounts of UST on its automated market creation platform Curve (CRV). Could these seven wallets announced by the firm have triggered the collapse?
These seven wallets, which were allegedly likely to trigger the crash, traded UST against other stablecoins on the Curve platform on the night of May 7. These seven wallets have withdrawn a significant amount of UST from the Anchor protocol on May 7 and April, connecting UST to the Ethereum blockchain via a wormhole.
Six of these seven wallets are exchanged from Curve’s liquidity pools to send more UST (pseudo-sell) or a subset of them. USD Coin (USDC) interacted with centralized exchanges to send
Nansen points out that wallets likely exploit price gaps between centralized and decentralized crypto exchange platforms, which could result in a depeg of UST rather than a single hacker launching an attack to destabilize the algorithmic stablecoin.
“TerraUSD wallets were probably trying to do an arbitrage by trading positions between centralized and decentralized markets. We therefore refute the unfounded allegations of a hacking attempt believed to have made the UST lose its stability.”
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