Blockchain Firm Hashed Loses $3.5B Due to Terra Ecosystem Collapse

According to on-chain data, the collapse of Terra cost blockchain company Hashed $3.5 billion in losses. Against the background of the incident, the investment firm Delphi Digital could also lose up to 13% of its assets, which was the equivalent of the peak value of the purchased LUNA tokens.

Delphi Digital representatives have admitted that they had concerns about the design of UST and LUNA, but believed in the ability of LFG with its reserve fund to prevent the “unthinkable.” The company wrote:

“We miscalculated the risk of a death spiral. Over the past week we have had to sweat a lot because of this, and we deserve it. Criticism is valid and we accept it.”

Delphi Ventures started by buying LUNA in the first quarter of 2021 at 0.5% of NAV at the time. The position increased as the asset grew. In February, the firm invested $10 million in LFG. Now, having not sold a single coin, Delphi Digital is forced to report a “large unrealized loss” in its financial statements. The company has explained:

“Unfortunately, LFG’s reserves ] weren’t growing fast enough compared to UST supply. Combined with the fall in the value of bitcoin, the overhang of liabilities turned out to be prohibitive to protect.”