In a recent interview, Bloomberg Intelligence senior commodity strategist Mike McGlone shared his thoughts on the UST collapse.
McGlone said the UST price slump was a warning to the rest of the crypto industry for algorithmic stablecoins: “It’s worth noting that this is part of a low tide for risk assets. When the tide goes out, you see who’s wearing clothes, and we found that based on the market Algorithmic stablecoins with rising demand are not a good idea.”
McGlone called UST’s collapse unfortunate, but not unexpected given the frothy state of the crypto market. He also said that Terra’s decline was expected, noting that the market needs to clear out the over-inflated crypto assets of the past two years.