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Vitalik supports retail investors misled by KOLs, endorses alternative solution: only reimburse funds to wallets of the 99% of small retail investors.

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Vitalik supports retail investors misled by KOLs, endorses alternative solution: only reimburse funds to wallets of the 99% of small retail investors.

After the collapse of UST, as the community wondered when the official rescue would come, Terra founder Do Kwon proposed a hard fork of the Terra blockchain to redistribute tokens to specific previous holders, potentially rendering existing tokens traded in the market meaningless. In his proposal, Do Kwon used a unique phrase: "make the ecosystem whole from the UST depegging event." The term "whole" seemed to have become a subject of mockery in the community.

Complete Definition? Discrepancy in UST Holdings Data

Casual investor @PersianCapital noted that a significant portion of Terra's new proposal is aimed at compensating Anchor Protocol's loss-making users. However, the data from Anchor Protocol is quite intriguing:

There are a total of 256,000 wallets using Anchor, with the top 1000 largest wallets holding 82% of the total UST supply, and even the smallest wallet among them holds 955,000 UST.

As per the original proposal, assuming Terra still has $1.5 billion to utilize, an existing UST might still be valued at 30 cents. However, this only provides 30% of the "complete" value to everyone, which in reality leaves everyone dissatisfied.

What is the "complete" that makes most people happy?

@PersianCapital proposed another definition of "complete," which is to allow the vast majority of small users, accounting for 99.6% of all users, to receive the full value of one dollar. This way, the majority of UST holders, the small users rather than the whales, will benefit greatly!

This means that through this approach, you can satisfy the vast majority of the community, improve overall sentiment, and be better prepared to face the whales. After all, isn't it the poor who need money the most?

A similarproposal with a similar concept is being discussed in the Terra governance forum, and the community generally agrees with this approach.

Vitalik Supports: Sympathy for Small Holders Who Trusted Influencers

Vitalik expressed strong support for this proposal, as it helps those small UST holders who initially invested based on influencers' claims of "20% USD interest." At the same time, he views the investments of large holders as personal responsibility, concluding with a simple "I'm sorry you suffered losses."

He also mentioned that this approach is similar to federal deposit insurance and the concept of providing higher protection, including for high earners, in Singapore's labor laws.