zlacker

>>donsup+(OP)
The whole idea was to become a middleman to a ponzi scheme and charge a performance fee.

They described what they are doing in their documentation, but the core ethical problem here is that the only users that would use their service are those incapable of understanding how UST/Terra worked, because anyone capable of understanding would just deposit funds directly and get higher APR for the same risk! Extremely predatory.

UST fooled many ...not very bright people who genuinely didn't realize it's a ponzi scheme - but obviously smart and technically proficient founders of Stablegains' have no such excuse. Zero room for doubt - they fully knew it's certain to collapse eventually, banking on their legal terms to protect them from liability while privately profiting as long as it works.

Founders of Stablegains belong in prison and everything they own should be confiscated and divided among victims. Sadly they are probably safe - as knowing the inevitability of collapse they must have felt their legalese to be ironclad.

>>nootro+p8
I just wish the liability could be extended to enablers that is funders... Sometimes I think companies should not really be limited liability...

>>Ekaros+Q8
I think investors probably didn't know. High safe defi yield existed for most of 2020 and 2021 - during that time it would be legit. It's possible that's how it happened - first plan based on safe yield that disappeared (exactly because it was high and safe), but instead of closing down founders decided to become middlemen to a ponzi.

>>nootro+v9
I feel like “safe” needs a giant asterisk applied to it in this sentence.

Just because something didn’t explode previously, doesn’t mean it was safe until now.

>>nrmitc+oa
No, perfectly safe three digit APR yield was the norm for months, and high double digit - for about 1.5 years. Checking the contracts was easy, as usually they were copied from other projects and thus known. Often capital was locked doing nothing at all, sometimes just providing liquidity in a lp pair. Took a while for the absurd risk premium to go down to its real value of ~0, crashing safe yields.

Ironically, this is partially what made UST so big - because to many people it looked like this:

(1) months of three digit APR - 'obviously unsafe' ('common sense' - high yield is sus, smells like ponzi)

(2) it wasn't a ponzi. Nothing bad happens. Many people make bank. Some have no idea what's safe and were just gambling, some make informed decisions

(3) eventually, the person in question feels stupid for missing free money and decides to put money in with no deep understanding

(4) safe yields crater from a combination of people like that + slow moving, but smart, funds that started to deposit hundreds of millions

(5) person in question deposits into the UST ponzi scheme by extrapolating safety record of non-ponzi farms that are now gone, due to a category error - 'it's defi and it was safe for so long, therefore UST is safe'

(6) not realizing it's a ponzi scheme they don't even try to exit when the gig is up. Massive loss.

Ironically I now see many examples of the same category error but applied in reverse - many people that lost on Luna think its collapse proved that defi is, in fact, fundamentally unsafe, when the reason they lost is because they put their money into a ponzi scheme that leveraged defi brand for marketing.

>>nootro+Uc
Why were people willing to pay a three digit APR yield to borrow assets then just keep those assets doing nothing at all?

>>Khoth+Nh
Nobody paid that in borrowing, that APR was generated by minting new tokens that could be sold to someone else.

>>nootro+Bp
Isn't that precisely a ponzi scheme?

>>Khoth+Lr
Generated tokens were different than what you had to deposit to get them. Deposited funds were (almost always) completely safe.