[___GS___]

Okay so I have Invested $100k in UST Anchor Protocol (For 19.42% APY).
Good or bad investment? I need suggestions.
(Considering an stablecoin, I think its good but need expert opinions)

EDIT: I have cashed it out for 291 BNB.

So my routes in last 15 days was:
260 BNB -> $103000 UST
$103500 UST -> 291 BNB

Still 31 BNB profit for me. Which is not bad.

[SUI-3183372]

In theory, if all goes to plan, it's very solid. Nothing else offers a 20% return for zero risk.

However, you're throwing $100k into an experiment, something we've never really experienced before. We'd like to believe that the Terra ecosystem grows organically and healthfully, and that this massive UST growth is sustainable. With such an overwhelming amount of UST utilization coming from the Anchor protocol, the same needs to be said for it as well. You're essentially relying on two platform's experiments to both turn out successfully. This means economically and programmatically, as errors in the code can also lead to doom.

Personally, it's too risky for me. If everything works out, I think you guys stand to earn handsomely, but I'm pretty risk-averse and I can't look past the potential for collapse.

[Krour]

As for every investment there's always a risk at hand, even hiding your money inside a safe in your house, it might get stolen.
That aside first and foremost always invest what you can afford to lose, but in my personal opinion this is as safe as an investment can be.
Good luck and I hope you get good returns as I'm doing.

[UNKNOWNI]

Imho investing $100k into BTC or other good crypto project can give better returns than just stake a stable coin

[___GS___]

In theory, if all goes to plan, it's very solid. Nothing else offers a 20% return for zero risk.

However, you're throwing $100k into an experiment, something we've never really experienced before. We'd like to believe that the Terra ecosystem grows organically and healthfully, and that this massive UST growth is sustainable. With such an overwhelming amount of UST utilization coming from the Anchor protocol, the same needs to be said for it as well. You're essentially relying on two platform's experiments to both turn out successfully. This means economically and programmatically, as errors in the code can also lead to doom.

Personally, it's too risky for me. If everything works out, I think you guys stand to earn handsomely, but I'm pretty risk-averse and I can't look past the potential for collapse.

Thanks for your opinion. But anchor protocol seems very promising.

As for every investment there's always a risk at hand, even hiding your money inside a safe in your house, it might get stolen.
That aside first and foremost always invest what you can afford to lose, but in my personal opinion this is as safe as an investment can be.
Good luck and I hope you get good returns as I'm doing.

Haha yeah true indeed. Special thanks to you for suggesting me.

Imho investing $100k into BTC or other good crypto project can give better returns than just stake a stable coin

Kinda risky to hold, either it may go down or up who knows. But thanks for your opinion.

[Yin Yang]

Safe bet, it’s a stable coin that has audits in-place.

Not in a liquidity pool either- that’s easy $

[SUI-3183372]

But anchor protocol seems very promising.

Poly Network, Wormhole, and Beanstalk were also very promising seeming.

Then they were exploited and drained of all of their liquidity before anyone could realize what was happening.

I know that this isn't a 1:1 comparison, I'm just trying to highlight that none of us have any idea how secure the platform really is. You simply hope the developers have done their due diligence, that audits have covered all bases.

Edit: Also I'm not trying to shit on UST or Anchor. I'd be lying if I said I wasn't incredibly tempted to get in myself, I'm just hesitant.

Edit 2: At one point I had heard that the Terra Foundation only had about 3 months of operating costs necessary to maintain this 20% APY rate, with the hopes that 3 months of this is enough time to draw people in and grow their ecosystem to a healthy level, and then at that point the rate can fall to its natural levels, still hopefully in the 15% range. Someone else had also told me they have an additional 3 months of operating costs set aside in case they need to to double that time span and continue offering 20% APY.

Can anyone verify this claim? I'll start digging to see if I can find where I read this.

[___GS___]

Safe bet, it’s a stable coin that has audits in-place.

Not in a liquidity pool either- that’s easy $

Yeah. Exactly.

Poly Network, Wormhole, and Beanstalk were also very promising seeming.

Then they were exploited and drained of all of their liquidity before anyone could realize what was happening.

I know that this isn't a 1:1 comparison, I'm just trying to highlight that none of us have any idea how secure the platform really is. You simply hope the developers have done their due diligence, that audits have covered all bases.

Like what will happen if they gets exploited?

[SUI-3183372]

Like what will happen if they gets exploited?

Yes. However, I wasn't aware of what Yin Yang stated. I thought Anchor Protocol was still just tossing your UST into a liquidity pool.

Do you maintain custody over your UST the entire time? Is the only risk UST destabilizing and becoming unpegged?

[___GS___]

Yes. However, I wasn't aware of what Yin Yang stated. I thought Anchor Protocol was still just tossing your UST into a liquidity pool.

Do you maintain custody over your UST the entire time? Is the only risk UST destabilizing and becoming unpegged?

Idk, but I am planning to withdraw my monthly profits.

[Omniscient]

I like the move. I assume this is only a portion of your holdings and it's a diversification move that ensures a $20k annual return in a sideways market.

[___GS___]

I like the move. I assume this is only a portion of your holdings and it's a diversification move that ensures a $20k annual return in a sideways market.

Exactly. $20k risk-free annual income(Unless or until they gets hacked/exploited).

[SUI-3183372]

Edit 2: At one point I had heard that the Terra Foundation only had about 3 months of operating costs necessary to maintain this 20% APY rate, with the hopes that 3 months of this is enough time to draw people in and grow their ecosystem to a healthy level, and then at that point the rate can fall to its natural levels, still hopefully in the 15% range. Someone else had also told me they have an additional 3 months of operating costs set aside in case they need to to double that time span and continue offering 20% APY.

Can anyone verify this claim? I'll start digging to see if I can find where I read this.

https://twitter.com/DeFi_Made_Here/statu...0440691714

This is what I was looking for. With the Luna Foundation Guard subsidizing the returns for Anchor, we get these 20% rates that we see today, but the actual organic returns that Anchor Protocol can offer are roughly only 6%. LFG has primed Anchor Protocol with $450m to subsidize their returns and it costs Anchor roughly $122m per month to do so, meaning they received 3 months of operating costs and will need to be replenished soon. These rates are only sustainable for as long as the LFG is willing to shovel hundreds of millions of dollars to Anchor Protocol, but the good news is it sounds like they're willing to keep doing this.

Furthermore, May 1st introduces the new Semi-Dynamic Earn rate, meaning the returns for Anchor are now going to shift between 15% and 20%, depending on the direction of pressure. This may introduce large impacts on the demand.

https://twitter.com/RossShuel/status/151...9996198914

I wouldn't get your hopes up for consistent 19.5% returns, you're likely going to hover at 16.5% - 18%.

The biggest problem I have with this is, the entire thing screams centralization. 75% of the utilization is happening on one platform. That platform can only offer the rates it does through subsidizing a singular platform. The money used to subsidize that platform comes from, again, a singular foundation. There's a large network being formed here with many singular points of failure that can cause the entire thing to come crashing down.

At this point I'm becoming a bit hesitant to call Anchor and UST DeFi. This is just CeFi playing dress up.

[shreder]

As others said its all good unless exploited. So there is always inherent risk.

[___GS___]

https://twitter.com/DeFi_Made_Here/statu...0440691714

This is what I was looking for. With the Luna Foundation Guard subsidizing the returns for Anchor, we get these 20% rates that we see today, but the actual organic returns that Anchor Protocol can offer are roughly only 6%. LFG has primed Anchor Protocol with $450m to subsidize their returns and it costs Anchor roughly $122m per month to do so, meaning they received 3 months of operating costs and will need to be replenished soon. These rates are only sustainable for as long as the LFG is willing to shovel hundreds of millions of dollars to Anchor Protocol, but the good news is it sounds like they're willing to keep doing this.

Furthermore, May 1st introduces the new Semi-Dynamic Earn rate, meaning the returns for Anchor are now going to shift between 15% and 20%, depending on the direction of pressure. This may introduce large impacts on the demand.

https://twitter.com/RossShuel/status/151...9996198914

I wouldn't get your hopes up for consistent 19.5% returns, you're likely going to hover at 16.5% - 18%.

The biggest problem I have with this is, the entire thing screams centralization. 75% of the utilization is happening on one platform. That platform can only offer the rates it does through subsidizing a singular platform. The money used to subsidize that platform comes from, again, a singular foundation. There's a large network being formed here with many singular points of failure that can cause the entire thing to come crashing down.

At this point I'm becoming a bit hesitant to call Anchor and UST DeFi. This is just CeFi playing dress up.

18-16.5% is also not bad even if it happens.
and I don't really care about the interest. As long as my invested funds are safe.

Even the good thing is that our funds are not locked. We can withdraw anytime.

Also keeping an eye on this one (which seems also interesting):
https://hackforums.net/showthread.php?tid=6202422

But yeah thanks for the detailed info.

As others said its all good unless exploited. So there is always inherent risk.

Yeah. Hope it never happens.