Read on Twitter
This is a solid thread on potential issues around ANC / MIR and ultimately LUNA. My thoughts below 
https://abs.twimg.com/emoji/v2/... draggable="false" alt="👇🏻" title="Rückhand Zeigefinger nach unten (heller Hautton)" aria-label="Emoji: Rückhand Zeigefinger nach unten (heller Hautton)"> https://twitter.com/_0x_larry/status/1386393887749541889">https://twitter.com/_0x_larry...
High APR LPs are reminding me so much of ICOs in 2017. They are creating massive inflation across the crypto space as everyone chases the yield. It won’t end well for most of these, I promise. But...
I think the idea of using the ownership / equity of your software to bootstrap the usage of your protocol is revolutionary
Paying people to play circle jerk to earn more of a coin with no use outside of earning more of the same coin is a red flag if you can’t point to reason for use outside of this feedback loop. This is 90% of defi and anything with an LP with insane APR
I think $LUNA is one of the few exceptions that is utilizing this incredible new funding method to bootstrap its network and encourage use simply because it has products and a plan to break out of this defi circle jerk.
$MIR first. Fascinating because these mAssets can be used outside the terra ecosystem. If people want to own these, fees accrue to token holders long after the rewards stop. Worth the current FDV? Time will tell but possibly revolutionary idea https://abs.twimg.com/emoji/v2/... draggable="false" alt="đź’ˇ" title="Elektrische GlĂĽhbirne" aria-label="Emoji: Elektrische GlĂĽhbirne">
$ANC next - currently getting paid to use the system and encourage borrowing, it’s the best deal in town. Obviously this won’t last and the net rate will fall to 0% then eventually you will pay to borrow. Inevitable. But it will be competitive, I have no doubt. 5-10%.
If crypto is to become money, $ANC seeks to leverage the inflation of POS blockchains. With $ANC your savings account will do what it is supposed to do - store and protect your purchasing power through the passage of time.
There are many different levers and adjustments that will need to be made to achieve this goal and I am certain that it will take time to learn how to manage this system and find balance.
Terra has 4 years to learn about all the different imbalances and issues that will come up.
Right now it seems like 50-100% interest earned on a 5% loan is normal and represents the future. It’s not, I promise. Most are abusing the absurdity of this but a select few are quietly building the future of finance.
If you study the history of money, I think you would find the 1000 year average rate of return is around 5%. I expect the Anchor earning rate to far exceed this rate over the next 10 years as money 2.0 comes online and POS network inflation normalizes.
The rate to borrow is likely to be around the historical average as the system matures.
The earn rate will likely always be able to beat the rate you can get a traditional bank. The mechanics of how this works is for another post, but it is logical.
@_0x_larry has valid questions that should be addressed. I probably didn’t respond to every question so please let me know if you have further questions.
