{"id":61680,"date":"2022-05-19T10:39:01","date_gmt":"2022-05-19T07:39:01","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=61680"},"modified":"2025-09-05T13:39:45","modified_gmt":"2025-09-05T10:39:45","slug":"mike-novogratz-says-terra-usd-was-a-big-idea-that-failed","status":"publish","type":"post","link":"https:\/\/u1f987.com\/en\/mike-novogratz-says-terra-usd-was-a-big-idea-that-failed\/","title":{"rendered":"Mike Novogratz says Terra USD was &#8216;a big idea that failed&#8217;"},"content":{"rendered":"<p>The collapse of the Terra ecosystem undermined trust in the DeFi sector and the broader crypto market, even as the idea of creating an algorithmic stablecoin looked promising. This was stated by Galaxy Digital founder Mike Novogratz.<\/p>\n<blockquote class=\\\"twitter-tweet\\\">\n<p lang=\\\"en\\\" dir=\\\"ltr\\\">After much thought, it\u2019s time to talk about last week and, more importantly, the weeks ahead. <a href=\\\"https:\/\/t.co\/m2pnzpe9Lu\\\">https:\/\/t.co\/m2pnzpe9Lu<\/a><\/p>\n<p>\u2014 Mike Novogratz (@novogratz) <a href=\\\"https:\/\/twitter.com\/novogratz\/status\/1526970321890312192?ref_src=twsrc%5Etfw\\\">May 18, 2022<\/a><\/p><\/blockquote>\n<p> <script async=\\\"\\\" src=\\\"https:\/\/platform.twitter.com\/widgets.js\\\" charset=\\\"utf-8\\\"><\/script><\/p>\n<p>Led by Novogratz, Galaxy Digital <a href=\\\"https:\/\/forklog.io\/razrabotchik-stejblkoina-terra-privlek-150-mln-ot-galaxy-digital-pantera-capital-i-drugih-investorerov\/\\\">became one of the investors<\/a> in Terraform Labs, which is developing the Terra ecosystem. And the executive himself identified as one of the so-called &#8216;LUNATICS&#8217;, backing it with a tattoo on his left arm.<\/p>\n<blockquote class=\\\"twitter-tweet\\\">\n<p lang=\\\"en\\\" dir=\\\"ltr\\\">I\u2019m officially a Lunatic!!! Thanks <a href=\\\"https:\/\/twitter.com\/stablekwon?ref_src=twsrc%5Etfw\\\">@stablekwon<\/a> And thank you my friends at Smith Street Tattoos. <a href=\\\"https:\/\/t.co\/2wfc00loDs\\\">pic.twitter.com\/2wfc00loDs<\/a><\/p>\n<p>\u2014 Mike Novogratz (@novogratz) <a href=\\\"https:\/\/twitter.com\/novogratz\/status\/1478535972560195585?ref_src=twsrc%5Etfw\\\">January 5, 2022<\/a><\/p><\/blockquote>\n<p> <script async=\\\"\\\" src=\\\"https:\/\/platform.twitter.com\/widgets.js\\\" charset=\\\"utf-8\\\"><\/script><\/p>\n<p>In a letter to the firm\u2019s employees, Novogratz said the company\u2019s interests would not be harmed. The crypto bank has a cushion of liquidity and capital, he added. Novogratz attributed Terra\u2019s fiasco to macroeconomic factors.<\/p>\n<p>According to the Galaxy Digital CEO, the low rates in traditional markets spurred speculative demand for UST in the Anchor protocol, with a yield of 18%, which displaced other Terra use cases. Going forward, pressure on reserve assets combined with the withdrawal of stablecoins created stress akin to a bank run.<\/p>\n<blockquote class=\\\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\\\">\n<p><em>There were not enough reserves to prevent the collapse of UST. Looking back, things always look clearer. My tattoo will be a constant reminder that venture investing requires humility<\/em>, Novogratz admitted.<\/p>\n<\/blockquote>\n<p>For the executive, the Terra USD collapse was yet another reminder of the need to adhere to the following investment principles:<\/p>\n<ul class=\\\"wp-block-list\\\">\n<li>portfolio diversification;<\/li>\n<li>partial profit-taking;<\/li>\n<li>a risk-management framework;<\/li>\n<li>an understanding of the macroeconomic backdrop.<\/li>\n<\/ul>\n<p>Many private investors could have avoided &#8216;heart-wrenching losses&#8217; if they had invested no more than 1\u20135% of their savings in the asset. Novogratz stressed that only the funds one is psychologically prepared to lose should be used.<\/p>\n<p>The executive forecast that conditions in the cryptocurrency market would remain challenging in the near term. That does not change his expectations of favourable prospects going forward.<\/p>\n<p>As a reminder, the CEO of Galaxy Digital <a href=\\\"https:\/\/forklog.io\/majk-novograts-dopustil-dalnejshee-snizhenie-tseny-bitkoina\/\\\">warned<\/a> about threats to support levels at $30 000 for Bitcoin and $2000 for Ethereum.\u00a0<\/p>\n<p>Earlier in Forbes <a href=\\\"https:\/\/forklog.io\/v-forbes-nazvali-krah-ust-i-luna-patoj-perezagruzkoj-kriptorynka\/\\\">\u043d\u0430\u0437\u0432\u0430\u043b\u0438<\/a> \u043a\u0440\u0430\u0445 UST \u0438 LUNA \u00ab\u043f\u044f\u0442\u043e\u0439 \u043f\u0435\u0440\u0435\u0437\u0430\u0433\u0440\u0443\u0437\u043a\u043e\u0439\u00bb \u043a\u0440\u0438\u043f\u0442\u043e\u0440\u044b\u043d\u043a\u0430.<\/p>\n<p> \u041f\u043e\u0434\u043f\u0438\u0441\u044b\u0432\u0430\u0439\u0442\u0435\u0441\u044c \u043d\u0430 \u043d\u043e\u0432\u043e\u0441\u0442\u0438 ForkLog \u0432 Telegram: <a href=\\\"https:\/\/t.me\/forklogfeed\\\" target=\\\"_blank\\\" rel=\\\"nofollow noopener\\\">ForkLog Feed<\/a> \u2014 \u0432\u0441\u044f \u043b\u0435\u043d\u0442\u0430 \u043d\u043e\u0432\u043e\u0441\u0442\u0435\u0439, <a href=\\\"https:\/\/telegram.me\/forklog\\\" target=\\\"_blank\\\" rel=\\\"nofollow noopener\\\">ForkLog<\/a> \u2014 \u0441\u0430\u043c\u044b\u0435 \u0432\u0430\u0436\u043d\u044b\u0435 \u043d\u043e\u0432\u043e\u0441\u0442\u0438, \u0438\u043d\u0444\u043e\u0433\u0440\u0430\u0444\u0438\u043a\u0430 \u0438 \u043c\u043d\u0435\u043d\u0438\u044f <\/p>\n","protected":false},"excerpt":{"rendered":"<p>The collapse of the Terra ecosystem undermined trust in the DeFi sector and the broader crypto market, even though the idea of creating an algorithmic stablecoin looked promising. This was stated by Galaxy Digital founder Mike Novogratz.<\/p>\n","protected":false},"author":1,"featured_media":61681,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"1","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1303,807,852],"class_list":["post-61680","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-mike-novogratz","tag-stablecoins","tag-terra"],"aioseo_notices":[],"amp_enabled":true,"views":"15","promo_type":"1","layout_type":"1","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/61680","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/comments?post=61680"}],"version-history":[{"count":1,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/61680\/revisions"}],"predecessor-version":[{"id":61682,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/posts\/61680\/revisions\/61682"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media\/61681"}],"wp:attachment":[{"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/media?parent=61680"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/categories?post=61680"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/u1f987.com\/en\/wp-json\/wp\/v2\/tags?post=61680"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}