Luna Publishes Whitewashing Technical Audit Report

This is truly pathetic. Paying $800 per hour, the question I ask myself is: why bother?

Today, LFG releases the technical audit report conducted by JS Held, an experienced third-party auditing firm, providing full transparency into the trading, blockchain records, and efforts of LFG and TFL to defend the price of TerraUSD ($UST) between May 8th & May 12th, 2022. [my bold]

The tweet thread:

The article: LFG — Technical Audit Report

The report: Analysis – Terraform Labs’ and Luna Foundation Guard’s Defense of the UST Price Peg

I have written before that I was very suspicious of the huge amount of BTC that was being bought to "defend" the UST peg. But... BTC!! That's stupid; a sharp drop in BTC price means they would be under-collateralised. It took me a few days to understand the stupidity, while I watched the Luna forum denizens cheering them on. Buy more!! WTF.

Doing an analysis of "the defence" answers none of the questions as to why Luna was wasting so much money on the wrong asset.

The most charitable thing I can say for both DK and SBF is that they fucked up big time - and that's not a sign of genius. Actually, I use the word "genius" with a huge sneer. Coders should never be allowed to design economic models. As for pure fraud, that takes genius not to get caught!

As for the "analysis", why bother now? The real analysis should be about why it was a garbage protocol. Someone, somewhere, is going to look at all the edge-cases that can destroy a protocol - and wait to strike. If any of those edge-cases are vulnerable, then you defend yourself by adding defences to those vulnerabilities.

"We hope that this report shows our organizations’ commitment to transparency and the wider crypto ecosystem, and we are more committed than ever to learn from our failure and continue to build systems that are more transparent, decentralized, and resilient.” Do Kwon, founder of Terraform Labs.

No, it does no such thing. You just opened the curtains to reveal that the shutters are still down.

Truly pathetic.