Introduction: Dangerous Narrative
Opinions are gaining popularity in the Binance Square feed (for example, from the author @TERRA_ORACLE ), that recent court rulings in the Terraform Labs and Do Kwon case are the "foundation for the moon".
The argument sounds nice: "The court punished the creator but acquitted the token. Now the path for large funds is open."
Let's analyze this logic from the perspective of real economics, not dreams.
Myth #1: "Confiscation of tokens from Kwon = Burning"
What fans say:
The author claims that authorities will seize billions of tokens from fraudsters, and this will become a "dead supply" (in effect, burning), as they will remain in the authorities' wallets forever.
Harsh Reality:
The state (USA or South Korea) is not a crypto enthusiast.
Goal of confiscation: To return money to affected investors.
Mechanism: When the state seizes assets (Bitcoins from Silk Road or oligarchs' yachts), it SELLS them (auction or market sale) to obtain dollars and pay compensation.
Conclusion: If Do Kwon's billions of LUNA are taken away, they will not be burned. They will be sold on the market. This will create huge selling pressure, not a price increase.
Myth #2: "The token has been recognized as legal — therefore, it will grow"
What fans say:
"The court did not say that LUNA is a crime. Therefore, the asset is legally clean."
Harsh Reality:
Shares of Enron or MMM were also not banned for some time after the crash. The fact that the asset was not removed from the exchange (delisting) means only one thing:
Exchanges (Binance, OKX) continue to earn from commissions from speculators.
Lack of prohibition ≠ Investment attractiveness.
The token is "legal," but it is still part of an ecosystem that has lost the trust of 99% of the world.
Myth #3: "Large funds (Smart Money) will now enter without fear"
What fans say:
"Increased regulation makes the asset acceptable for major players."
Harsh Reality:
Institutional investors (BlackRock, Fidelity) have the strictest risk management departments (Compliance).
They invest in Bitcoin (BTC) because it is digital gold.
They invest in Ethereum (ETH) because it is a global technology.
They will NEVER invest clients' money in an asset branded as "the largest algorithmic fraud in history," even if the court has formally "cleared" the token. The reputational risk is too great.
💡 Conclusion for the investor
Don't let beautiful words about the "Phoenix" cloud your judgment.
Hopium: The belief that confiscated coins will simply disappear is self-deception.
Facts: LUNA has an infinite emission and a tarnished reputation.
Strategy: While fans wait for a miracle from the courts, wise investors simply hold BTC and BNB, which are growing on real adoption, not legal loopholes.
Don't look for gold in the landfill of history. Build a portfolio of market leaders.
