Terra’s Do Kwon allegedly rejected an initial 3.6% interest rate on the Anchor protocol.
Anchor’s interest rate was reportedly increased to 20% one week before the protocol went live.
According to the designers of LUNA, the collapse of Terra was visible from the beginning.
The founder of Terra (LUNA), Do Kwon, allegedly rejected an initial 3.6% interest rate on the Anchor Protocol.
According to the team at WuBlockchain, the interest rate of 20% on the Anchor Protocol was introduced one week before it was released. The team at WuBlockchain shared their insights on Anchor through the following tweet.
According to JTBC, Anchor's designers said that the original interest rate was designed to be 3.6%, but the proposal was not accepted by Do Kwon, and Anchor's interest rate was raised to 20% a week before the release. https://t.co/THhM51shhM
Terra (LUNA) Designers Knew it Would Eventually Collapse.
Furthermore, according to the JBTC report quoted by WuBlockchain, the designers behind Terra (LUNA) knew that the digital asset would eventually collapse. The report stated:
We also met with key insiders who designed the Terra/Luna coin.
They said in one voice, “We foresaw a collapse from the time we designed it.”
I informed CEO Kwon Do-hyung in advance, but he said he did not listen at all. The circumstances in which management pushed the business forward even though they knew the risk of a collapse was documented in the documents we obtained.
The report by JBTC goes further and explains that the designers of Terra (LUNA) had calculated that the earlier mentioned 3.6% interest rate was sustainable. They decided to increase the rate a bit higher to keep Terra stable. Their calculations were based on the fact that there was insufficient money within the project to pay the interest.
However, the interest rate was soon adjusted to 20% with Do Kwon’s nod, as explained below.
It was just a week before the launch of the anchor that Mr. B and other designers found out that the company would pay investors a whopping 20% interest rate.
Mr B/Internal core designer [explained] ‘I did not know that this would go out with such a high interest rate. Set it to 20%, just a week before the release, I suggested to CEO Kwon Do-hyeong that the interest rate should be lowered, but it was not accepted.’