Terra Community Member Finds Loopholes in Report Claiming Terraform Labs Caused UST’s Depegging

June 14, 2022

Key takeaways:

  • Terra community member Fatman has found loopholes in a report claiming that TerraForm labs caused UST’s depegging event in early May.
  • According to Fatman, the Terra wallet cited in the report does not belong to the Terra Classic DAO.
  • He also requests the publishers of the report to contact him for fact-checking.

Terra community member Fatman has poked holes into a report by CoinDesk Korea, hinting that a wallet owned by TerraForm labs caused UST’s collapse.

The report by Coindesk Korea was compiled in collaboration with Uppsala Security to determine the source of the funds that had initiated the liquidity crisis on Curve Finance, thus kickstarting UST’s depegging.

According to Fatman, the report by Coindesk Korea suggests that TerraForm labs intentionally caused the depegging of UST. Fatman goes on to explain that this is not the case. He concludes that the report is ‘total nonsense,’ as demonstrated in the tweet below.

CoinDesk Korea just released the bombshell revelation that the wallet behind the UST depegging is actually owned by Terraform Labs. If true, this would mean TFL intentionally caused the depegging. https://t.co/FPvEYjuuq1

But it’s not true – it’s total nonsense. (1/4)

— FatMan (@FatManTerra) June 14, 2022

Fatman Deduced that the Cited Terra Wallet Does Not Belong to TerraForm Labs.

In his investigations, Fatman pokes holes into the theory at the backbone of the report, that Terra’s Binance account is linked to a Wallet A that initiated the UST depeg on Curve finance. He explained:

The general idea is, allegedly, Terra’s Binance account (that got an initial deposit from LUNC DAO) is linked to Wallet A, the Curve UST dumper, because it also transacted heavily with LUNC DAO.

But the one simple thing they missed is that’s not LUNC DAO’s wallet! That’s KuCoin’s hot wallet!

It makes the whole report nonsense, because obviously two addresses are not linked simply by virtue of receiving money from KuCoin. All it means is they are both KuCoin users. Nothing sinister and nothing proven.

Terra Community Member Fatman Requests Coindesk Korea to Reach out To Him for More Facts.

Fatman also requests the team at Coindesk Korea to reach out to him if they want the actual facts on the wallet identified as belonging to TerraForm labs. He said:

PS. If you need your reports fact-checked, feel free to get in touch. I’m always here. I am disappointed that an outlet as prestigious as CoinDesk Korea would publish this without running basic checks.

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