Edit 7: The Terra Blockchain has been halted as of block 7607789

There was a circulating supply of 11.28B UST and a circulating supply of at least 6.87 Trillion Terra at the time it was shut off. It’s unclear what happens to the $11.28B in UST but I’m going to presume it’s dead.

Edit6: CMC had a glitch where the price of Luna is not displaying correctly. As a result market cap is showing 20B they manually moved it into the 200 range. Also Binance delisted Luna.

^{Edit 1-5 moved to bottom of post}

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I've been following the state of Luna over the last week and have a number of posts on it - with my most recent one from yesterday - warning people not to buy the dip. I've been trying to figure out what to expect next and if ever would be a good time to invest in Terra.

What do you need to know -

• UST and Luna price are directly related - You can burn Luna and mint UST, or you can burn UST and mint Luna. On May 8th (not including any fees you could burn about 60 UST ($60) to get 1 Luna ($60) - when UST started depegging people became financially incentivized to burn UST and convert it to Luna - increasing the supply of Luna. Since demand isn't keeping up with the increased supply - the price of Luna is continuing to crash. Currently with 1 UST worth $.55 and 1 Luna worth $.0058 (not including fees you can mint 330.57 Luna for $1 (true dollar) of UST.
• Prior to the depeg there was a circulating supply of 18.6B UST. Currently there is a circulating supply of 11.9B UST. Meaning it only took 36% of the supply of UST to drop the price of Terra from $60 to .006. a 99.9999% drop. There is still 64% of the total UST that hasn't been removed/converted back to Luna. There is still a long.............. way Luna can fall.
• Why would someone convert UST back to Luna? Because UST is worth $.55 and it can be converted to $1 of Terra. No guarantee it will be worth that though by the time you get/sell it (you could even lose money trying assuming the price of Terra continues to drop)
• The circulating supply of Luna is up 425% in the last three days and likely to increase further and significantly faster as the depeg remains off and money flows out of UST into Terra further exponentially increasing the supply and dropping the price of Terra.
• A lot more Terra is being minted for every UST now than yesterday. Yesterday for every $1 (true Dollar) of UST you'd get about 1-2 Luna today that's 330 and it's going to continue to increase at a faster and faster rate as the price of Luna falls. This is the death spiral of Luna and why investors shouldn't think they're getting Luna for cheap.
• If the total marketcap of UST was lower maybe Luna could have survived this above $1 eventually people may have ran out of UST to burn for Luna and maybe you'd be ok buying it in case it ever recovered (this is likely part of why the last two depegs didn't crush Luna - the marketcap of UST was still relatively low enough Luna was able to weather the influx of UST burns.

Speculation. What isn't clear is will people stop buying Luna. I mean if you get 10,000 Luna for $1 are some people going to buy it in case it ever "recovers?". If so will the people buying be able to continue to support people in UST trying to get out of the asset, or will people stop buying Luna if it adds another 10 decimal points (speculation) if so what happens to the money in UST? - does 11.9B stuck in UST became worthless if people aren't buying Luna? Eventually when this is all done with does Luna have a future without UST?

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None of this speculation is entirely clear, but what is clear - is.. UST is suffocating Luna and it could potentially become worthless unless people continue to buy Luna despite the number of decimal points it's going to quickly start adding.

Last note UST has 11.9B stuck in and it's supported/can be exchanged for Luna which has a marketcap of roughly 16.6M-50M depending on the platform.

Final Final note - some of the numbers are not perfectly correlated in different sections because the price was fluctuating while I was writing this.

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TLDR: Be prepared for Luna to drop alot farther $1 can now mint multiple hundreds of Luna and that will likely increase to thousands soon.

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Edit: Breaking Luna blockchain has been halted. I’m not familiar with details of that yet, but read below for my initial post. The blockchain has resumed without staking

Edit2: multiple sources are saying circulating supply is actually 33B+ a 10,000% increase from the prior amount of 343M since May 8th.

Edit3: according to the link in the top comment supply is 50B now up 50% since this was posted….

Edit 4: if ops top comment is to be believed we’re at 227B total supply of Luna now. Up 7x from when this post went live.

Edit 5: We just hit 1 trillion in the circulating supply of Luna. Like 20 minutes later we’re now at 2.43 Trillion..3 Trillion