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Terra Crisis: Family Bonds Shattered, Dreams Ripped Apart

Terra Crisis: Family Bonds Shattered, Dreams Ripped Apart

  • Terra collapse has wiped off about $40 billion worth of investors money
  • Investors lose life savings

With last week’s death spiral involving the Terra collapse wiping off $40 billion worth of investors’ money, traders have been rattled.

The Terra ecosystem suffered a massive blow around May 9 that resulted in LUNA tanking 100% and the TerraUSD (UST) stablecoin losing its United States dollar peg, priced at $0.00017 at the time of writing, according to data from Coinmarketcap.

Investors lose savings

Bankless Times spoke to a few investors who had placed their bets on LUNA, most of whom were of the opinion that they have lost all hopes of any revival of their savings.

Hitesh Malviya, the founder of venture capital firm iBC Capital, says he had bought LUNA at $4 a day before it got delisted and had invested an amount that he could afford to lose.

I have zero hopes of recovery as my buying price was too high. The supply has increased drastically, and even after executing the revival plan, its price cannot reach $1 again. It is, therefore, better to move on.
Hitesh Malviya, Founder of venture capital firm iBC Capital

Another investor, who lost a substantial amount, said, “It hardly matters if LUNA continues to trade or not, as it has reached a price that is nearly irreversible even if there is a miraculous recovery of the Terra network. While the token may have recovered 200% from its lows, people who invested in the range of $80-$100 will never recover their losses.”

He claimed to have lost 50% of his total portfolio due to investments in LUNA and said the whole fiasco should be a lesson to investors to invest in bluechip tokens like Bitcoin and Ethereum as they are safer in the long run.

Lost money saved for daughter's wedding

Another investor in his forties, who hoped to catch a falling knife when LUNA fell in the range of $3-$4, says he diluted long-term investments from other tokens saved for his daughter’s marriage and all his life savings have evaporated in a matter of 48 hours.

“I have lost around $19000, all of which was saved for my daughter’s wedding. My life’s biggest mistake has been to dilute money in bluechip tokens in which I was earning a decent amount with staking. I have not even told my wife about this. I absolutely have no idea what will happen when she finds out all our money is gone,” he said.

Samina Haidry, another investor, too says she has reached a point of no return.

“When the crypto market was down, my investment was down to one-fifth of the original investment. Luna however witnessed a crash rarely seen in crypto markets. Since this was the fourth largest crypto, I trusted and decided to sell all my coins and invest in Luna, expecting it to give huge returns. I am yet to overcome the shock of seeing my portfolio down to zero from about $5000 just a week back,” she said.

'Investors should learn lessons'

Experts say that the tanking of LUNA is a black swan event, rare but plausible and investors should learn a lesson from the event.

“Always understand then when we invest, we take a risk and we should be mentally prepared for that. The second - review and hedge - always. We are sometimes convinced about a particular company and go either all-in or almost all-in investing in that company. A fatal error,” Raj Kapoor, Chief Advisor at Acryptoverse, a crypto and blockchain advisory firm, says.

He adds that greed is another factor investors should be wary about. “The folks who have bought Luna earlier in the year had already almost 3X by April, but they probably did not take profits hoping the black swan stock would return another few folds in the next few months,” he says.

Murtuza Merchant

Murtuza Merchant

Murtuza Merchant is a senior journalist, having been associated with various publications for over a decade. An avid follower of blockchain tech and cryptocurrencies, he is part of a crypto advisory firm that advises corporates – startups and established firms on media strategies.